Crypto should not have gods. Just auditable data.

Antoine Scalia
5 min readNov 17, 2022

Crypto was born as a trustless system with the potential to reshape tech and finance around the world.

The glorification of Sam Bankman-Fried before the dramatic collapse of his FTX empire last week demonstrates that a handful of ‘elected leaders’ have become the voice of the industry. Their actions have the power to transform but also ruin what this industry represents.

Crypto must free itself the handful of ‘elected leaders’ who have become its gods

Centralizing power in the hands of these Crypto Gods defeats the purpose of the technology designed to free us from the consequences of malicious actors like SBF.

To rebuild trust, the industry must break ties with these gods, and embrace the unique feature of blockchains — transparent and verifiable data.

Satoshi Nakamoto understood that there is an inherent contradiction and risk in having individuals promote decentralized and trustless systems — his anonymity plays a crucial role in Bitcoin’s legitimacy.

Having the power in the hands of a few figureheads poses an existential threat to the future of decentralized systems. Allowing these individuals to shape the industry narrative leaves us at risk of being blinded by their worldview and diverts us from advancing Satoshi’s legacy. Additionally, the risk of collusion increases when we allow a small number of actors to dominate the industry.

Examples of actors using their power to benefit themselves are easy to find. Do Kwon, SBF, 3AC have all leveraged their public exposure to benefit their personal interests and feed their ego. Not long ago, SBF bailed out BlockFi and others, claiming he acted to “save the industry.” This act of “kindness” only reinforced his monopoly, keeping BlockFi’s funds on FTX and their loans at Alameda.

Obviously, this was possible because FTX is built on centralized and opaque infrastructure — not on open protocols. This architecture is riddled with the same flaws that have plagued traditional finance in the past 40 years:

  • Accounting frauds built on opaque financials
  • Collusion with other market participants
  • Over leverage
  • Risk of contagion…

Secondly, putting these individuals at the forefront has caused industry defocus and a shift to “crypto as the asset” rather than “crypto as the rails”.

The primary use case of crypto so far has been speculation. Founders of centralized exchanges and lending platforms have gained worldwide renown and have used their position of authority to promote this one single use case: speculation:

And speculation does not really need smart contracts, just assets to buy and sell. A good old SQL database could do the job to record the transactions. If that’s all we wanted to build, why bother with blockchains!

Therefore, crypto became about the “assets” and less about the “infrastructure” that is blockchain and crypto.

This is what crypto actually is and should be: a decentralized infrastructure that you can use to build trustless networks and products. Assets are just a way to build incentives across different participants so that they don’t need to trust each other (trustless). And these networks hold the power to solve real-world problems, with one unique property at the core — transparency and accountability.

Blockchains can unlock solutions to diverse real-world problems

So as builders in crypto, what do we do now?

SBF and others ‘leaders’ have made crypto a big casino. Through their misconduct, they have destroyed the trust of regulators and non-crypto participants.

Data is how we (re)build trust in trustless systems. But the infrastructure is not there yet.

Be it DeFi, DeSci, or DAOs, people need to understand what’s happening under the hood to trust your crypto-native product. Everyone should be able to see its mechanics — your users, your investors, regulators or auditors, they all must have access to the data.

While we keep repeating ourselves that blockchains are transparent and that “everything is on-chain, you just have to read it”, we need to realize that the data is not digestible. The infrastructure is not ready yet.

On-chain data is not just about explorers like Etherscan. Reading blockchains, especially at scale and with reasonable performance, is a tedious task. Different stakeholders have distinct use-cases, and most will struggle to build a system that suits their needs:

  • Users want to know how much liquidity is in a DeFi contract. And how solvent and stable the product they are using is.
  • Compliance officers want to understand all the actors involved.
  • Auditors and accountants want data for closing and auditing financial statements.
  • Investors want data for due diligence…

As a company building a crypto product, getting these things right is what separates you from the SBF’s of the world.

Here are a few examples of what you can do today to start (re) building trust with your stakeholders, ranging from very simple to far more complex solutions.

First, one of the easier solutions is to give your users simple access to a data visualization tool with your company/product crypto holdings, using either Cryptio or Nansen Portfolio. See an example here:

A more complex solution is to become “really” serious about Proof of Reserves:

  • Proof of Reserve could mean very different things and industry standards need to be built.
  • No matter if you start to do it yourself as a snapshot, your end goal should be to do it assisted by a top auditor (Reach out if you want intro) and have it real-time.
  • Your objective might just be to share data on what you have or go a bit further and enhance user verification.
  • You can find a great example of this below.

Lastly, you need to seriously question the robustness of your internal back-office and financial reporting process. Ask yourself:

  • Can I guarantee that my books are accurate and that I am actually tracking every single on-chain movement?
  • Am I conducting a balance reconciliation to prove the completeness and accuracy of the data?
  • Do I have an auditable crypto sub-ledger system that I use for the month-end reconciliation process?
  • Am I compliant with the existing accounting and tax regulation?

It is by answering these complex questions that we will rebuild trust in the technology, and even down the line remove the need for any forms of trust.

Because this is what crypto should always be about. Building trustless systems.

To do that, we need a massive collaboration of experts to build industry best practices for on-chain reporting, proof of reserves, accounting, and audits.

The time has come to bring together on-chain data companies (accounting, reporting, compliance..), investors, auditors, accountants, regulators and more!

Let’s not forget — most of us started working in this space because we believe in a more transparent future.

Let’s make that happen, and renounce the Crypto Gods.



Antoine Scalia

Building the Data Back-Office Infrastructure for Crypto