Former FTX.US president Brett Harrison says the collapse of the exchange he once worked for offers some lessons on how to prevent the next crypto disaster.
In a new interview with Scott Melker, Harrison says the need for increased independent oversight is one main lesson he has taken away from the FTX collapse.
“A couple of high-level learnings. Obviously, we’re going to ignore all of the fraud aspect, which was just terrible and shocking and it definitely raises questions about not how you prevent fraud, because criminals will always find a way, but more like what kinds of systems can you put in place to be able to have proper oversight. The people working on proof-of-reserve or proof-of-solvency protocols, I think that could be extremely helpful [and] having independent agencies looking over centralized entities in the crypto space.
DeFi (decentralized finance) has so much promise because it is a way of providing a truly transparent execution and custody that everyone can see and everyone can audit.
As long as we’re going to have a world where there are centralized actors and digital assets that basically form the function of brokers – they really are, they hold dollars on behalf of customers and they execute orders on behalf of customers – those basically should be regulated and audited and overseen by brokers and that should be a separate thing from DeFi. But I think that would be a huge help to regaining trust and confidence in the digital assets world.”
Harrison also says he has realized the importance of creating decentralized products when users have greater control over their own information.
“Some personal learnings are trying to build products and services that are sort of decentralized. I don’t necessarily mean that in the blockchain sense, I mean more in that the customer maintains as much control as possible over their own information.”
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