Bybit’s Ben Zhou Shuts Down Insolvency Speculation With $11B Proof of Reserves
The post Bybit’s Ben Zhou Shuts Down Insolvency Speculation With $11B Proof of Reserves appeared first on Coinpedia Fintech News
Ben Zhou, the CEO of the cryptocurrency exchange Bybit, has now effectively dispelled negative rumours of the exchange’s liquidity issues or an alleged hack. The speculation that began on May 22 was especially actuated by false proof-of-reserves data relayed by Arkham Intelligence.
The rumours similar to the FTX fall recently appeared on X which received a lot of roast and serious concerns from Bybit users about their fund’s withdrawal. To calm the growing unrest, Zhou decided to address the people and assure them using social media.
Misleading data sparks panic
The source of the problem was a single error in a proof-of-reserves graph from the firm Arkham Intelligence. This graphical error caused fear of Bybit being hacked or insolvent.
To address the rising rumours, Zhou made a post on X to address both Bybit’s clientele and the crypto-dedicated readers. He stated:
“Regarding to some rumours I have heard, such as Bybit being insolvent or hacked and so on, please be noted that we have already updated our PoR this month and all the Bybit wallets are available in Nansen now (Total assets over $11B). Most of the rumours I have met do not have any real facts to support. ”
Proof of solvency provided
To support this claim about Bybit’s financial stability, Zhou directed participants to Bybit PoR and a Bybit-Nansen dashboard. This board presents all wallets existing on Bybit and the assets are stored in it, proving that the exchange has over 100% of the clients’ funds.
Checking the PoR data, it was established that Bybit has not less than $ 11 billion worth of cryptocurrencies, covering all users’ withdrawal requests.
Using the Nansen data, it can be seen that Bybit indeed has significant holdings however the data obtained should not be considered as the full picture of the exchange’s assets or reserves as stated by the firm.
Regulatory scrutiny amidst reassurances
Nevertheless, there are still constant challenges from the regulators to Bybit. AMF (Autorité des Marchés Financiers) has again warned investors against Bybit Two weeks ago, the securities regulator in France gave out a new notice that ordinarily pointed to Bybit.
The AMF called on customers to “prepare for the possibility of the platform STOPPING services suddenly” because Bybit is not registered with DASP and conducts unlawful business in France.
This comes as a warning from the AMF which resembled a similar warning from Hong Kong’s Securities and Futures Commission (SFC) in March this year placing Bybit as one of the dubious exchanges it warned the public not to transact with since it is unlicensed.
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