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by soulofmischief 1278 days ago
It's because internal exchange transactions are not on-chain. When you deposit crypto to a typical exchange, it sits in a hot wallet or gets moved to cold storage. Any further transactions you make on the platform, such as exchanging currency, just shift around balances on a regular database. Only when you withdraw does it show on the chain. This is not a crypto problem.
1 comments
di456 1278 days ago
There's no technical reason why internal accounting systems didn't post to a Blockchain based ledger.

However most companies don't build their own accounting systems, it's too much of a liability and good luck getting an auditor to sign off on financials from something homegrown.

And I not even sure if a commercial off the shelf blockchain-based accounting system exists, does one?

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soulofmischief 1278 days ago
> There's no technical reason why internal accounting systems didn't post to a Blockchain based ledger.

I agree. Using the main chain obviously costs network fees, which for the high amount of transactions involved in running an exchange is untenable. However, there's no reason an exchange couldn't use its own public blockchain to allow independent auditing.

> And I not even sure if a commercial off the shelf blockchain-based accounting system exists, does one?

Not to my knowledge, and I know some crypto projects would love to use a product like this. Could be worth doing some market research.

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di456 1278 days ago
There is one market where I see a need for this, and it's OSS where transparency is important for building trust.

However, what's holding any company back from releasing a read-only connection to their live financial systems?

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imtringued 1278 days ago
There are Ethereum rollups which basically work like that. There is a 7 day window to post a fraud proof.
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soulofmischief 1278 days ago
A cursory search of zk rollups and decentralized exchanges brings up https://blog.kyber.network/zkyber-a-new-dex-trading-experien...

Any experience with them? I'd be curious to see how it holds up in practice.

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di456 1278 days ago
There's a huge disconnect between the technical execution of blockchain or crypto exchange, and running a business with proper internal controls.
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di456 1278 days ago
I have no ideas what that means, but the time period for legal discovery is usually around 7 years.
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