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OKX to Release Monthly Proof of Reserves Report to Win Customer Trust

OKX has announced that both the old and new reserve ratios are publicly available for users to view and download to evaluate the safety of their assets on the exchange for themselves. In a press release, OKX said it would publish a “proof of reserve report” monthly. The report aims to provide more transparency to OKX Exchange users by offering evidence of its liabilities and assets. OKX has demonstrated its commitment to openness and transparency in financial management by allowing users to see and download the old and new reserve ratios, check the balances and ownership of the exchange’s reserve addresses. OKX’s last proof of reserve report, published on December 23, revealed a slight decline in the Bitcoin reserve ratio, which stood at 101% as of December 20, 2022, at 12:00 UTC. This was a 1% drop from the 102% reported in the first report released on November 22. The reserve ratio for Tether (USDT) stayed the same at 101%, while the reserve ratio for Ether (ETH) went up to 103%. The analytics firm Nansen said that BTC, ETH, and USDT made up more than 90% of all holdings. With wallets holding 113,754 Bitcoin (valued at US$1.87 billion) against a user balance of 112,192 Bitcoin (BTC), OKX remains well-equipped to facilitate smooth and secure trading operations.

OKX releases proof-of-reserve after FTX collapse to build trust

After the failure of FTX, cryptocurrency exchanges began using proof of reserves; an audit technique developed to ensure that the custodian, in this case, OKX, is not lending out customer funds like FTX did and possesses the assets it claims to hold on behalf of its users. OKX will now build trust in how the exchange works, just like many other exchanges have done recently following the collapse of FTX, therefore reducing the risk of fraud or mismanagement. Besides, users will better understand the exchange’s financial health and risk profile. Hence, it enables them to make more informed decisions on using the exchange to either trade, hold or acquire cryptocurrencies. The new report will include a list of the institution’s assets and information about its financial performance, such as its net income, net liability, net assets, and overall financial stability. The move aims at helping not only customers but also investors to evaluate the exchange’s proposition and position. OKX published its mission to maintain a 1:1 reserve for user funds on its website. By publishing a regular PoR, users can easily audit the permanence of the ratio. For example, users can see that real assets back their funds at a 1:1 ratio. However, a significant point of discussion in the crypto community is that the Proof of Reserves report needs more specifics about liabilities and internal quality controls. For example, Binance’s most recent proof of reserves report was heavily criticized for not providing enough information about how the exchange liquidates assets to fund margin loans.

   

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