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The largest crypto exchange in the world, with the help of its new Proof-of-Reserve system, intends to regularly prove to its users that their assets are not in danger.
Binance announced the launch of its systemconfirmation of reserves, which should become, as the company says, the next step towards greater transparency and strengthening trust in the trading platform ecosystem. At first, the PoR system will work with bitcoins; the crypto exchange will add other cryptocurrencies and tokens in the next few weeks.
“Our reserve confirmation system will affectonly those assets that are stored for users. This means that we intend to prove to our clients that Binance has funds that cover all their assets 1:1, and there is still a reserve left,” the announcement says.
The crypto exchange published data on balances onaccounts and own bitcoin reserves as of November 22. The exchange has 582,485 BTC in reserves and a net user balance of 575,742 BTC. This means that the reserve ratio is about 101%.
It is reported that users will be ableindependently verify personal assets on the platform using the Binance Merkle Tree tool, which combines large amounts of data into a single hash. In addition, the exchange plans to attract third-party auditors to test the new system and implement zero-knowledge proof technology.
Earlier, the crypto exchange announced plans to launch a special fund to help cryptocurrency companies that faced a liquidity crisis two weeks ago due to the default of the FTX crypto exchange.
