Letter from the CEO - Transparency in the age of Blockchain

Earlier this year, Gate.io celebrated its 9th anniversary. The industry has come a long way since the company's inception. For context, when I founded the company in 2013, many early adopters relied on buying crypto over forums using PayPal, leading to scams. There was a need for something better, and simpler. In the years since, exchanges have become critical to mass adoption, Bitcoin has grown from an obscure form of digital money to a game-changing asset, and there are thousands of different assets to choose from.

When Satoshi Nakamoto first introduced Bitcoin, transparency was an important aspect as evident by the open ledger and the nature of blockchain technology. I remember reading the Bitcoin Whitepaper and thinking that this would revolutionise the world of finance. In wake of recent events where major companies operating in the space declared bankruptcy or were left insolvenct, and users left in the lurch, transparency has become a key focus once again. Transparency has always been an important priority for Gate.io, and it was an important guiding principle when I founded the company.


Industry Leaders MUST Be More Transparent

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With the spate of recent bankruptcies and rumours of more, transparency has become a hot topic in the industry. Industry leaders need to lead by example with a transparent operation. In 2020 Gate.io announced that we would be opening up to a proof-of-reserves audit by a reputable external auditor. This showed our users that their deposited assets are safe and have not been used to make any risky bets.

In the process, we patented the proof-of-reserves method involving Merkle Trees and came back with a clean audit. We introduced a feature where users could actively check that their individual assets are being held safely in our custody. Earlier this month, we announced our second proof-of-reserves audit, partly because of the current turmoil and uncertainty in the market and to ensure that our users know that we take the safety of their assets very seriously.

But this is just one side of the coin, the other is that we want to lead by example and encourage other leaders in the space to operate more transparently. Personally, I believe all exchanges should exercise similar transparency to show their commitment to their users and the safety of their assets.


Leading by Example

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To date, Gate.io is the only mainstream exchange to willingly, and openly, submit to a proof-of-reserves audit. We are taking a proactive approach to being as transparent as possible and want to actively encourage other leaders to follow in our footsteps by being more transparent, especially considering the current struggling global economy and the state of the crypto market, where more and more platforms are declaring bankruptcies or going insolvent.

In the same vein, we want to ensure our users know that their assets are being kept safe and that Gate.io is not actively using their deposits to make risky trades in the market. We maintain a high standard when it comes to the security of our platform. Blockchain technology was developed to be as transparent as possible, so we must continue operating this way if we want the crypto industry to continue growing.


Commitment to Security and Compliance

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We remain committed to making a lasting impact in the market and continue to show our commitment to our users, and the safety of their assets. In the same vein, we are also committed to working proactively with regulators in the various jurisdictions we operate in. This means obtaining the necessary licensing to ensure our users can enjoy an uninterrupted experience while using the Gate.io ecosystem. The first step is our recent announcement that we have received a VFA Class 4 License in Malta.

Over the next few months, I will be writing more pieces like this one to ensure we continue to be transparent and give my honest opinion on the state of the market, the history of Gate.io, and how we've spent the last decade building great products instead of craving the limelight. Despite the current volatility in the market, I believe that the future for crypto and blockchain technology is bright and the market will come back stronger than ever.


~ Dr Han Lin, Founder and CEO of Gate.io