Unlike most exchanges, you control your own private keys, so funds remain yours even when you’re trading with them. No one can reverse a transaction or freeze your account. Similarly, the exchange’s funds are all on the blockchain, totally transparently - so they can be audited by anyone, any time.
As I understand it the only way this could work is if when you deposit Bitcoin into CCEDK they give you a market pegged asset (BitBTC) in return on the BitShares blockchain. A UIA that represents BTC would become worthless if the exchange was goxxed.
Problems:
What if you deposit BTC and there is no BitBTC available to buy because no one is shorting it?
And what about for all the other altcoins where there is no volume to support a market pegged asset?
Also, what about the accusation that CCEDK as an exchange would then be operating on fractional reserves because they had to sell your BTC deposit for some derivative BitBTC that most maximalists dont want to believe even works?