Mazars Veritas, a financial auditing company responsible for Binance's Proof-of-Reserves, announced this week that it was shutting down crypto businesses. According to Mazars, Binance, among others, falsely claimed that they had carried out a full check. After Mazars' announcement, there was a moment of panic, after which the Binance token fell by 10 percent.

There's more to it

So we no longer have to rely on Mazars' reports when it comes to monitoring crypto companies. That in itself is not a bad thing, because there is now another way to check the reserves of stock exchanges. We can see on the blockchain 'how clean' the reserves of an exchange are. The less dependent they are on their own token, the cleaner the reserves.

Click here for information about how to earn money without investing your own money

If we look at that metric, Binance's reserves, for example, are pretty clean. They are only 10.95 percent dependent on their own BNB token. However, we cannot say the same for a Huobi, which produces a shockingly low 'beauty percentage' at 56.57 percent.

This means Huobi's reserves of $3 billion are 43.3 percent of its own exchange token. That is what the focus should be on now and not on Binance. Also because Huobi is one of the largest exchanges at the moment with a trading volume of approximately USD 422 million per day.

The strange situation at Huobi

It is striking that Huobi is also introducing a new burn mechanism for its token at the moment. This should make the value of the token more interesting for investors. It seems that they are trying to lure even more people into the token that way, which is a suspicious activity if your balance consists of 43.3 percent of your token.

Click here for information about how to earn money without investing your own money

From the start of the year, the token's value is down 40 percent and is trading at $5.46. “Huobi reserves look very risky right now,” CryptoQuant’s Caue Oliveria said in a message to CoinDesk. Be aware that things went wrong for FTX in the end because of the FTX Token (FTT). After a while, he uses it as collateral for loans.

However, before we scream bloody murder, it is important to also know Huobi's debt position. If the user simply holds so many Huobi tokens at the exchange or these are pure reserves with no debts, then it can all be fine with the exchange platform.

Click here for information about how to earn money without investing your own money