After FTX, everyone knows that exchanges will eventually have to prove they still have money.
But when it comes to proving reserves, the problems arise again.
Users want to see if the platform is still alive, and regulators want to see if the accounts match up, but exchanges cannot possibly expose all wallets, market-making paths, and asset allocation rhythms.
Once the books are open, trust may be established, but the bottom cards are also revealed.
@MidnightNetwork is quite suitable for this task.
When the official provided guidance for startups, they directly presented the ZK Proof-of-Reserves Auditor, and the idea is very clear: what the platform needs to present is proof of "I have sufficient reserves," not the entire underlying asset table in a package.
What it promotes is rational privacy and selective disclosure, meaning the results can be verified while sensitive details are not laid bare.
This way, users can know whether the platform is lying, and the platform does not have to expose all positions and addresses to the market.
This is not just a simple narrative of privacy; it addresses a gap that has not been well managed in public chains.
Proving reserves does not mean exposing oneself completely.
The true value of Midnight lies in these on-chain scenarios that are most prone to trust crises and most fearful of excessive transparency.
@MidnightNetwork $NIGHT #night
