Before the serious effects of FTX, the CEO of Binance gave 6 principles that Binance and centralized exchanges should adopt to ensure trust with users.
CZ emphasized in his article, the most important role of exchanges at the moment must be to protect users. User funds cannot be used for illegal purposes and must be kept safe.
6 principles of CZ include:
Be risk averse with user funds
Never use native tokens as collateral
Share live proof of assets
Keep strong reserves
Avoid excessive leverage
Strengthen & Enforce Security Protocols
It can be seen that the principles that CZ gave are the mistakes that FTX made that led to the collapse of an empire in the market. Many companies have filed for bankruptcy because of the impact. At the same time, after FTX, there have been many exchanges involved in scandals about using users’ funds in an untransparent manner.
CZ’s principles is timely and contributes to affirming the current market leadership position of Binance and CEO Changpeng Zhao.
