Crypto.com has become the latest cryptocurrency exchange to release its Proof of Reserves data from auditing firm Mazars Group, proving that its customers’ assets are fully one-to-one backed.
as of friday blog postAuditing firm Mazar conducted the verification process, which revealed that the exchange has a 102% collateralization ratio for its bitcoin reserves, 101% collateralization ratio for its Ethereum, and 102% and 106% collateralization ratio for its USDC and USDT.
Crypto.com said, “This independent third-party audited report under ISRS 4400, as set forth by the International Auditing and Assurance Standards Board (IAASB), uses advanced cryptographic procedures to verify the availability and support of our customer balances. “
A Proof of Reserves (PoR) is an independent investigation conducted by a third party on centralized crypto exchanges. The goal is to ensure that those platforms hold the assets they claim on behalf of their clients.
The audit comes as it was revealed in mid-November that Crypto.com sent by mistake 320,000 ETH to a wallet address linked to Gate.io. While the exchange claims that it has recovered the assets, this has somehow affected the credibility of the platform.
“Providing proof of reserve is an important step to begin the process of increasing transparency and restoring trust for the entire industry,” said Chris Marszalek, CEO of Crypto.com. “Crypto.com is fully committed to providing customers around the world with a safe, secure and compliant means of engaging with digital currencies.”
as informed of, Binance, the world’s largest cryptocurrency exchange, also shared its Proof of Reserves report. The report audited by Mazars revealed that Binance’s bitcoin reserves have a collateralization ratio of 101%.
Other crypto platforms that have completed their Proof of Reserve audit include Kraken, BitMEX, Coinfloor, Gate.io, and HBTC, according to the data. accumulated By Nick Carter, a partner at Castle Island Ventures and cofounder of blockchain data aggregator Coinmetrics.io.
It is worth noting that some industry veterans have argued that proof of reserves alone is not sufficient. This is because this practice does not reveal the overall balance sheet and liabilities of the platform, making it difficult for users to thoroughly verify a company’s financial position.
“Proof of reserves is a good start, but to be useful it needs to be combined with proof of liabilities,” Told Emin Gunn Sirer, CEO of Ava Labs. In other words, crypto platforms can only borrow money for the short term to meet their PoR.
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