- Changpeng Zhao clarified that the huge transaction was a part of the Proof-of-Reserve Audit.
- He added that the auditor asked Binance to send a specific amount to itself to show that they control the wallet.
- Binance’s Proof-of-Reserves has been under constant scrutiny since its launch.
Founder and CEO of crypto exchange Binance, Changpeng Zhao refuted claims that 127,351 Bitcoin (2,062,504,721 USD) were transferred from Binance to an unknown wallet.
Twitter handle, WhaleAlert which is a tracker and analytics system tweeted about the ‘suspicious’ transaction.
In response to this claim, CZ tweeted:
This is part of the Proof-of-Reserve Audit. The auditor require us to send a specific amount to ourselves to show we control the wallet. And the rest goes to a Change Address, which is a new address. In this case, the Input tx is big, and so is the Change. Ignore FUD!
When pointed out by users that this transaction was used by crypto pundits to predict a collapse, CZ hinted that their shorts might get wrecked.
Dyma Budorin, Co-founder of Hacken claimed that it was for proof of assets that the transaction was done. Budorin added that this could also be done by signing text statements with the reviewed wallet. Zhao then explained that not every wallet infrastructure supports signing.
Zhao further elaborated on his refutations as he retweeted his post from 2018 citing a similar incident.
The CEO concluded as he asked users to be alert and not believe fear, uncertainty, doubt(FUD)all the time.
Looks like every move from the leading crypto exchange Binance is under constant scrutiny after the FTX debacle. Binance’s newly introduced Proof-of-Reserves was recently said to be devoid of “proof-of-liabilities”. To this, CZ clarified that there is no negative balance involved in PoR.