The Dubai-based exchange created a verification method for consumers to track their holdings immediately after disclosing their reserve wallet addresses during the FTX crisis.
Bybit's new measures
Following the FTX disaster, the cryptocurrency exchange Bybit has joined the parade of exchanges in the sector striving for transparency. It announced the deployment of a User might immediately verify Bybit's holdings and the assets they have put into the exchange thanks to the new transparency initiative.
All users with monies in their financing and trading accounts, including those with cryptocurrency holdings in Bybit Earn products, are eligible for the function. The new capability also confirms who owns Bybit's wallet (1) and that a 1:1 ratio is used to hold assets. Co-founder and CEO of Bybit, Ben Zhou, offered commentary on the application of Merkle Trees in liquidity verification.
What did this change?
The exchange is reportedly improving withdrawals and tightening its risk management processes. Additionally, it pledged to make all of its Bitcoin content public Wallets. The week after the FTX incident started to come to light, on November 16, it already made its reserve wallet addresses public. Numerous of the biggest participants in the sector have introduced such transparency initiatives as customers focus on maintaining the security of their cash and the accountability of exchanges. Binance initially provided the public with its reserves and promise for a Merkle Tree-based system, which it revealed two weeks later.
Red flags were revealed in the exchange's finances, including its business structure, BTC liabilities, and the caliber of its internal controls, when it shared some of its otherwise internal data. Two other exchanges came under fire when Huobi and Gate.io shared screenshots of their reserves utilizing borrowed money. While Grayscale claims that security concerns make them reluctant to divulge anything. The co-founder and CEO of Kraken, Jesse Powell, released a statement in which he said that without the whole amount of customer obligations, all of these efforts to demonstrate reserves are useless.