/biz/ - Business & Finance

>>57513966
Fractional reserves didn't became a thing until the recent bear market. That's when Binance noted that Monero was one of the most shorted assets and that it didn't have a transparent chains. So they started simply not buying Monero when someone deposited USD, but still accredited the account with a deposit. As most people didn't withdraw this caused no problem, but they could gain extra money from this by selling the more lucrative short options. Fake deposits created an increased supply driving down price increasing shorting from which Binance gained millions.
This obviously occurred at the expense of Monero's price and the community's money. People started raising awareness, a bank run (titled Monerun) was successfully pulled off, and Binance was effectively facing an increasing issue with liquidity, so they presumably raised reserves once again. Since then (round about June 2022) Monero's price has been at a normal and steady increase of 17% YoY.
Most of this is speculation since what Binance and their peers are doing is plainly fraudulent, we can only see the signs. However, if you're interested in seeing the extent to which this was one, you should look at the quantity of short positions vs long positions open on Binance. Also the price deviation of exchanges from Kraken's price will tell a similar story as Monero's price on other exchanges dips bellow Kraken's price when they turn on the printers, and then rebounds after a few weeks when the exchanges buy the necessary reserves to meet their withdraw demands.
I hope this helped explain what the situation is and why it occurs.

>>56251106
To keep it at a lower level, blinding factors in commitments ensure that the final commitment is random. The way Pedersen commitments work is by multiplying a value by a given factor. As we work on Elliptic Curves, multiplication with a point is equivalent of encryption and cannot be reversed with the current technology. If such a multiplication was done by the same factor, even if we couldn't reverse it an attacker could still make a cheat table precomputing possible values. To resolve this, a blinding factor is generated for each output, and added to the commitment to randomize the output. And the blinding factor alongside the amount used is communicated to the sender in an encrypted way. Using the viewkey can already decrypt that, and that's why view-only wallets can view the incoming amounts, but not the outgoing.
Range proofs make Pedersen commitments actually work by ensuring that all the blinding factors and values are correct. They are complicated so much so that even Zero to Monero skips over them. However, the general idea I get is that you prove that you are in possession of the binary decomposition of the individual bits that compose the amount that is being transacted. This is done with a large ring signature interesting enough (members are keys generated from commitments to each bit). tl;dr is that this decomposition to bits makes sure that the amount is positive, and it's within Monero's supply.
Ring signatures can work in a multitude of ways. Some more efficient, some simpler. If I had to give a simple explanation, it would be that each member in the ring is referring to the previous one allowing the true signer to close the loop. This forms a ring and all an outsider is able to decipher is that at some point one of the rings signed the transaction with their private key.
If you are a coder, I highly recommend checking out the CCS funded https://www.moneroinflation.com/ and looking around for subjects of interests.