Binance CEO Changpeng Zhao shared what he said were the six most important requirements that every centralized exchange should adopt to ensure trust in the wake of the collapse of rival exchange FTX.
The listed principles included:
- 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.
“We cannot let a few bad actors sully the reputation of this industry when it’s still in its infancy,” Zhao wrote. “Our role, first and foremost, must be to protect users.”
Zhao, who said on Monday that he’s working to create an industry group to work with regulators worldwide, called on other exchanges to adopt the six proposals. Zhao also said that he was working to set up a recovery fund for projects affected by FTX’s troubles.