OKX latest proof-of-reserves reveal $8.9B in assets
Global cryptocurrency exchange OKX released its fifth edition of its Proof-of-Reserves (PoR) report, which it began publishing in November 2022 to bring more transparency to the industry.
According to the latest edition, OKX holds $8.9 billion across Bitcoin (BTC), Ethereum (ETH) and the Tether stablecoin (USDT). This puts the reserve ratios of BTC, ETH, and USDT at 103%, 103%, and 102%, respectively.
This latest release also comes as the exchange has upgraded its PoR system with more transparency by making full liabilities (i.e. total balance of user deposits) publicly available.
Cointelegraph spoke to Lennix Lai, Managing Director of Global Institutional at OKX, about these additional steps towards transparency.
Lai said that recent events in the industry highlight that “crypto-native challenges require crypto-native solutions.”
“The blockchain and crypto/web3 industry is built on technology that enables trusted transactions on public blockchains, and this inherent transparency is incredibly valuable.”
Many exchanges in the industry – such as Binance, Crypto.com, and Bybit – have released such Merkle Tree-based verification credentials to protect the integrity of the industry in the wake of the FTX liquidation scandal.
“The FTX crisis had a silver lining in that it prompted successful companies to double down on security and transparency and spurred the industry to innovate in this area.”
Lai said the industry’s new mantra is “don’t trust – verify”. He said that over 300,000 users have already viewed reserves or checked their liabilities in the OKX ecosystem.
The new transparency mechanism, which made the total balance of user deposits visible to the public, still maintains user privacy by splitting and shuffling account liabilities in the tree through a solution known as “splitting leaf nodes”.
According to Lai, OKX will also add Zero Knowledge Proof to our PoR in the coming weeks.
Related: Tether’s assets exceed liabilities in BDO’s new reserves report
After the Silicon Valley Bank (SVB) crash, transparency in the financial industry has become even more of a talking point. Lai said in times of uncertainty like the banking crisis:
“Proof-of-reserves can provide users with real-time, on-chain verification of reserves and liabilities through transparent technology – this is how traditional finance differs from crypto.”
But as early as March 8, the Public Company Accounting Oversight Board, a US-based regulator that oversees audits of public companies, warned investors about PoRs. The board said these reports “do not provide any meaningful assurance to investors or the public.”
Nonetheless, companies in the crypto industry continue their transparency efforts. On February 10, Binance also added zk-snarks to its PoR system.