Binance Founder Zhao: Too Much Transparency on Decentralized Exchanges is Dangerous.

Binance founder Zhao announced the reason for this proposal to protect the privacy of traders and organizations

The worst word for a trader could be loss or liquidation. Can emerging platforms in the DeFi field really hurt large institutional market traders and whales by providing too much transparency?

Zhao cited the reason for this proposal as maintaining greater privacy for traders and cited problems such as MEV attacks, front-running, and market manipulation on current DEXes.

Chao has proposed a new kind of decentralized exchange (DEX) that aims to reduce risks for large traders, especially after recent high-profile losses. He pointed out that many DEXs show the order book openly, which makes big trades obvious and easy to target. This transparency can lead to manipulation, like front-running or other attacks. To fix this, Chao suggested building a DEX with privacy features.

Decentralized Exchange with a Hidden Order Book (Dark Pool DEX)

One key idea is a dark order book, which keeps order details hidden from the public. This makes it hard for others to know when large trades are happening and adjust their moves. He also proposed delaying the display of big deposits. This would hide large deposits from the market right after they arrive, helping prevent market abuse. 
Chao highlighted the importance of strong cryptography, especially Zero-Knowledge Proofs (ZK Proofs). These proofs let users confirm their transactions are valid without sharing private details, boosting both privacy and security.

Hyperliquid trader James Wayne loses more than $100 million

The reason for this idea came from a recent event involving James Wayne, a famous crypto trader known as a "hyperliquid whale." Wayne reportedly lost around $100 million in a single trade. He said that his loss was caused by the exposure of what he calls corruption in the markets. He believes that the current transparency, while meant to build trust, actually revealed his trades to bad actors. Using tools like dark order books and ZK Proofs can help prevent situations like his from happening again.