Binance unveils its proof of reserves mechanism

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  • Binance’s Proof of Reserve System initially shows results for major cryptocurrency Bitcoin.
  • The crypto exchange will implement ZK-SNARKs alongside other tokens and networks.
  • Crypto exchanges are trying to show that they are a must have asset after the shocking collapse of FTX.

binance has published its proof-of-reserve (PoR) system, days after CEO Changpeng Zhao promised to set up the mechanism following the collapse of rival FTX.

Bankruptcy and subsequent transition ravaged the market binance coin price A drop to the low of $250. bitcoin price also declined below $16,000, reaching its lowest level since 2020.

In reply, multiple exchanges released a snapshot of its asset reserves. But the crypto community at large noted that a snapshot of assets alone was not sufficient – ​​the liabilities of exchanges needed to be made available as well.

Binance’s Proof of Store Shows 101% Ratio

in his update on issue, Binance has noted that its users are now able to verify exchange holdings. For what is now possible, Binance has announced that the system will initially support Bitcoin. The exchange will look to add other tokens and networks over the next few weeks.

Binance will also allow auditing of its proof of store results by third-party auditors and help implement ZK-SNARKs to enhance privacy and robustness.

,Because Binance offers margin and loan services, the audit results will show each user’s net balance, equity and debt, where net balance = equity – debt.,” wrote the Binance team.

A snapshot taken on November 22, 2022 at 23:59 (UTC) shows that Binance’s on-chain bitcoin balance was 582,485.9302, while the client’s net balance was 575,742.4228. The reserve ratio from the snapshot was 101%, with margin of 6,743 BTC.

Binance customers can verify whether the exchange should hold their cryptocurrency or not.

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