This week, I'd like to highlight trust challenges facing global markets today and how we at InfinityBit plan on implementing a first-of-its-kind trust infrastructure that will drive global financial services transformations for decades to come.
For any service provider, there is no market without trust. Unfortunately, there has been a consistent trend of the public's declining trust in traditional financial institutions across multiple sectors. Today, only 25% of Americans have a high confidence level in banks as opposed to 60% twenty-five years ago. Considering rampant inflation, soaring gas prices, and pandemic aftershocks, it’s no wonder that three out of four U.S. adults believe national economic conditions are deteriorating, with less than half believing the economy will eventually bounce back. However, non-traditional financial services offerings have been a growing global trend for empowering individuals to leverage influence through alternative channels and empower their financial futures.
Consumer choices, acting as economic ballots, communicate shifts in public opinion to markets that have resulted in real change. Bitcoin recently pointed out this trend of “voting with your money” as extending to the world of finance. Considering declining public trust in governments and traditional financial institutions, consumers are increasingly avoiding fiat currencies altogether in favor of cryptocurrencies. Because cryptocurrencies operate on decentralized blockchain technology, they can enhance security and transparency, thereby reducing the risk of fraud, manipulation, and operational errors. Due to the absence of intermediaries like old traditional financial service providers, newer cryptocurrency exchanges are faster, private, and more cost-effective.
Despite its potential to reshape the global financial landscape, the cryptocurrency market has grappled with concerns related to the transparency and security of funds held by centralized exchanges since its inception. Highly publicized growing pains of the original crypto exchanges have led to a lingering sense of unease among cryptocurrency users. Moreover, the recent implosion of FTX, one of the world's largest crypto exchanges, had cast a shadow over the entire cryptocurrency industry, highlighting its vulnerability with a lack of transparency. At InfinityBit, we are continuously analyzing past missteps by early platforms as well as the global future needs of both the retail and institutional global markets. We intend to provide the world's first centralized crypto exchange that will implement on-chain verifiable proof of reserves. This groundbreaking feature will help redefine transparency and trust within the realm of centralized exchanges, paving the way for a new era of security and accountability.
Unlike traditional audits, which can be infrequent and lack real-time updates, on-chain proof of reserves ensures that users can independently verify the exchange's holdings at any given moment thereby acting as active participants in verifying the exchange's solvency and security of their assets. This level of communal transparency fosters a sense of security, attracting both seasoned traders and newcomers to InfinityBit. Additionally, the open nature of blockchain technology means that auditors can conduct independent verification, further bolstering the exchange’s credibility. InfinityBit’s collaborative approach to transparency is spearheading an industry-wide checks-and-balances system that will benefit the entire crypto community.
In future posts I'll be talking about additional features as well as rollout strategies beginning with non-US regions. Stay tuned!
Dixon Bernier, CEO
Dixon Bernier (@InfinityBit_CEO) / X