Binance CSO: CEX May Stop Existing In 10 Years As Markets Move To DeFi

Binance Chief strategy officer Patrick Hillman said centralized exchanges (CEXs) could become obsolete in about 10 years given the current crypto industry that is leading a shift to decentralized finance.

For now, the exchange is trying to keep customers’ trust after the collapse of rival exchange FTX by implementing “proof of reserves”, which is a way to show customers that their assets are fully backed. But the process has been slow, Hillman said Thursday on CoinDesk’s “First Mover” program.

Patrick Hillman said the company’s centralized exchange could cease to exist within 10 years as the crypto market is evolving towards decentralized finance (DeFi).

“It will be a multistep process, including bringing in a third-party auditor,(…). It takes time to go and be able to conduct an audit of the scope and scale that is required of Binance.”

He said

While not disclosing the exact amount of funds held in the company’s account, Patrick Hillman said Binance has “complete confidence” in the reserves.

In the wake of FTX’s crash last Friday, Binance made the announcement that it is setting up a new Proof of Reserve (PoR) website to demonstrate that it is holding all of its customers’ assets, as an intermediary holding digital currency.

Binance started with Bitcoin reserves. Currently, this company’s BTC reserve ratio is 101%. This shows that Binance has a sufficient supply of cryptocurrencies corresponding to all user balances.

Users will be able to check the website for a more open look at the company’s proof of reserve and the exchange’s reserve ratio in relation to customer liabilities.

In the coming weeks, Binance, the world’s largest cryptocurrency exchange by trading volume, will introduce additional tokens and networks.

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