CZ asks the perps from the dark pool of Shield merchants from the race in Defi

The founder of Binance, Changpeng Zhao, better known as CZ, has floated the idea of ​​a decentralized exchange (DEX) where orders books and user positions are hidden to mitigate the risks of liquidation and liquidation.

The call is produced in the midst of renewed attention to the maximum removable value (MEV), the practice of manipulating the order of profit transactions.

The Dark Group argument

On June 1 mail In X, CZ questioned why Dexs continue to expose users’ orders in real time, noting that such transparency often invites predatory tactics such as frontal career and liquidation, particularly in the markets of perpetual future.

“For the Perses (or future), it is even more important not to make others know/see their orders,” CZ wrote. “If others can see their liquidation point, they could try to push the market to liquidate it. Even if it has one billion dollars, others can attack it.”

The former Cryptography Executive drew a direct parallel to traditional finances (Tradfi), where large institutional merchants routinely use the so -called “dark groups”, private exchanges that hide orders books. He affirmed that such services are often “10 times bigger” than normal orders books.

To that end, Zhao proposed that chain platforms could use zero knowledge cryptography (ZK) or similar encryption technologies to obscure commercial data, including orders and deposits, until they are executed. In his opinion, this would create a commercial experience that protects participants, especially whales, from MEV attacks and coordinated manipulation.

CZ’s suggestion occurs after a series of dramatic bets of the cryptographic merchant James Wynn, who reached more than $ 1 billion in BTC before being settled in four different positions, totaling more than $ 100 million. After the event, Wynn tweeted that his experience had exposed corruption in the cryptography market, and advised the merchants to buy and maintain BTC instead of using it for a high leverage.

Emerging solutions

Several projects went up to the publication of CZ to announce that they were actively working in the privacy space. Sam, from sad, revealed That during the last two years, his team has been developing a concept similar to what the former Binance CEO had outlined.

Others such as 0x0 and Skale are also addressing the challenge. 0x0 dismissed Its next Specter platform, which allows spots and leverage of privacy, while Skale recently launched its bite protocol, a consensus layer encryption tool designed to eliminate MeV completely by avoiding the visibility of the transaction before the end of the blockade. “Instead of applying the curite, Bite goes to Mev at his root,” said Skale CEO, Jack O’Holleran.

However, not everyone is singing from the same book of Hymns. X user Cedric Beau counteracted CZ’s proposal, arguing that dark groups fundamentally contradict the spirit of cryptography:

“Dark pools in cryptography? That is exactly what we came here to avoid,” said the decentralization enthusiast. “At the moment he hides the book of orders, recreation internal games.”

He also warned that importing the “shadow tricks” of tradfi runs the risk of losing the proposal of opening of the defi value. “Transparency is messy, but at least everyone plays in the same field.”