{"id":43634,"date":"2025-06-02T16:00:36","date_gmt":"2025-06-02T13:00:36","guid":{"rendered":"https:\/\/coinengineer.net\/blog\/?p=43634"},"modified":"2025-06-02T15:17:57","modified_gmt":"2025-06-02T12:17:57","slug":"binance-dark-pool-dex-market-manipulation","status":"publish","type":"post","link":"https:\/\/coinengineer.net\/blog\/binance-dark-pool-dex-market-manipulation\/","title":{"rendered":"Binance Co-Founder\u2019s CZ Dark Pool Move to Crush Manipulation!\u00a0"},"content":{"rendered":"<p><span data-contrast=\"auto\"><a href=\"https:\/\/coinengineer.net\/blog\/binance-cz-warning-phishing-attacks-crypto-security\/\"><strong>Changpeng \u201cCZ\u201d Zhao<\/strong><\/a>, co-founder of <strong>Binance<\/strong>, proposed establishing a <strong>decentralized exchange (DEX)<\/strong> with continuous swaps and dark pools to protect large investors from front-running and <strong>MEV <\/strong>attacks. Zhao stated that most market manipulations occur through public order books. \u201cIt always surprised me that everyone can see your orders in real-time on a <a href=\"https:\/\/x.com\/cz_binance\/status\/1929246168833229243\"><strong>DEX<\/strong><\/a>,\u201d he said. For example, when buying a <strong>$1 billion coin<\/strong>, the order needs to remain hidden until completed. This prevents attacks by <strong>MEV bots<\/strong>.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Binance Zhao emphasized that <strong>DEXs with liquidations<\/strong> are in an even worse situation.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<blockquote><p><span data-contrast=\"auto\">\u201cIf others can see your liquidation point, they might gang up and try to force your liquidation. Even with $1 billion, others can form a cartel against you.\u201d<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p><\/blockquote>\n<p><span data-contrast=\"auto\">Hence, privacy is crucial. Zhao added, \u201cUsing <strong>zk-SNARK<\/strong> or <strong>zk-STARK<\/strong> to execute transactions without revealing details and verify outcomes is a concrete approach.\u201d<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Recently, trader James Wynn\u2019s <strong>$100 million Bitcoin<\/strong> <strong>long position<\/strong> was liquidated on <strong>Hyperliquid<\/strong> after Bitcoin fell below $105,000. This event raised liquidation hunting allegations. A user on X claimed <strong>Tron founder Justin Sun<\/strong> showed interest, though unconfirmed. The user even suggested inviting <strong>Eric Trump<\/strong>, son of former <strong>US President Donald Trump<\/strong>, to the group.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h2><span data-contrast=\"auto\">Binance CZ Privacy for Derivatives Trading<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\"><strong>Binance CZ<\/strong> explained that large investors in traditional finance use <strong>dark pools<\/strong> where order size and price remain hidden to prevent <strong>market<\/strong> manipulation. <strong>Dark pools<\/strong> are private, non-public trading venues. However, creating decentralized dark pools is complex. <strong>Zero-knowledge<\/strong> proofs and delayed settlement mechanisms are examples.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Zhao acknowledged some prefer transparency to absorb large orders easily.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<blockquote><p><span data-contrast=\"auto\">\u201cI won\u2019t debate what\u2019s right or wrong. Different traders prefer different market types,\u201d he said.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p><\/blockquote>\n<p><span data-contrast=\"auto\">He encouraged developers to launch <strong>on-chain<\/strong> <strong>dark pool DEXs<\/strong> with continuous swaps. This can be achieved \u201ceither by not showing the order book or, better yet, by not revealing deposits to smart contracts until much later.\u201d<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-ccp-props=\"{}\"> <em>You can also freely share your thoughts and comments about the topic in the comment section. Additionally, don\u2019t forget to follow us on our\u00a0<a href=\"https:\/\/t.me\/coinengineernews\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>Telegram,\u00a0<\/strong><\/a><a href=\"https:\/\/www.youtube.com\/@CoinEngineer\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><strong>YouTube<\/strong><\/a>,\u00a0and\u00a0<a href=\"https:\/\/twitter.com\/coinengineers\" target=\"_blank\" rel=\"nofollow noopener\"><strong>Twitter<\/strong><\/a>\u00a0channels for the latest\u00a0<a title=\"News\" href=\"https:\/\/coinengineer.net\/blog\/news\/\" data-internallinksmanager029f6b8e52c=\"7\">news<\/a>\u00a0and updates.<\/em><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Changpeng \u201cCZ\u201d Zhao, co-founder of Binance, proposed establishing a decentralized exchange (DEX) with continuous swaps and dark pools to protect large investors from front-running and MEV attacks. Zhao stated that most market manipulations occur through public order books. \u201cIt always surprised me that everyone can see your orders in real-time on a DEX,\u201d he said.<\/p>\n","protected":false},"author":36,"featured_media":36278,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[657,2],"tags":[17131,17122,17133,17129,17125,17132,17124,17134,17128,17123,17135,17121,17130,17126,17127],"class_list":["post-43634","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-en","category-news","tag-blockchain-transaction-privacy","tag-continuous-swaps-on-blockchain","tag-crypto-derivatives-security","tag-crypto-market-security","tag-crypto-trading-privacy","tag-decentralized-exchange-privacy","tag-decentralized-finance-privacy","tag-defi-liquidation-protection","tag-front-running-prevention-techniques","tag-liquidation-hunting-in-crypto-markets","tag-mev-attack-prevention","tag-mev-protection-for-large-traders","tag-privacy-focused-dex","tag-zk-snark-privacy-solutions","tag-zk-stark-zero-knowledge-proofs"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Binance Co-Founder\u2019s CZ Dark Pool Move to Crush Manipulation!\u00a0 - Coin Engineer<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/coinengineer.net\/blog\/binance-dark-pool-dex-market-manipulation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Binance Co-Founder\u2019s CZ Dark Pool Move to Crush Manipulation!\u00a0 - Coin Engineer\" \/>\n<meta property=\"og:description\" content=\"Changpeng \u201cCZ\u201d Zhao, co-founder of Binance, proposed establishing a decentralized exchange (DEX) with continuous swaps and dark pools to protect large investors from front-running and MEV attacks. 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