Hey all, Happy New Year! I hope everyone enjoyed their holidays and shared laughter and made memories with their families and loved ones. I had some good food and some nice sparkling wine
Also, there will be a new exchange soon, for the Philippines islands! This is exciting, I have not seen another exchange with PHP that supports BTG until now:
This is new for our community and the team is looking to reach out and embrace this new market. I wonder how the market will react to the January 3 âProof of Keysâ event. Itâs becoming quite popular, look at this:
I have mixed feelings about the Proof of Keys event.
I totally get the intent - ensure the Exchanges are solvent by withdrawing all the funds, which forces insolvent exchanges to fail. It feels like a way to force the truth into the open, albeit in an aggressive and damaging way.
But there are problems with if - for one, if an exchange actually is insolvent, it means those who promote and encourage the event get out whole, but the public which is less-informed gets screwed. In a ânormalâ exchange failure, all asset holders get the same haircut, but this way, some people do better than others.
And for the exchanges which are not insolvent - and will survive the event just fine - youâre screwing with business. For everyone. Youâre making them pull from cold storage unnecessarily, which exposes risk. Youâre clobbering exchange/trading volume for a day. Youâre disrupting peopleâs lending on margin orders.
Despite all that⌠it probably wonât work. You probably donât get enough people withdrawing to actually cause an insolvent exchange to go down. If the exchange only has half the assets they should⌠and as many as half of the people withdraw their assets⌠the exchange survives! (And I donât have any reason to think they actually get 50% participation.)
It seems like a needlessly disruptive and vindictive way to try to âforceâ a kind of transparency, and it feels less like a legitimate âcheck on powerâ and more like a way for people angry at exchanges to lash out at them.
