Leading Cryptocurrency Exchanges That Have Published Proof of Reserves - Coindoo
Proof of Reserves

Leading Cryptocurrency Exchanges That Have Published Proof of Reserves

Editorial Team Avatar
Jan 23, 2023
6 min reading time

There is no question that transparency plays a crucial role in the cryptocurrency sector. The premise of decentralization powered by blockchain technology is to create an ecosystem without any central governing bodies. Trustless and accessible solutions are its main driving factors. In 2022, the industry was shaken by a few large cryptocurrency platforms, and protocols became insolvent due to the mismanagement of funds and other illicit activities. One of these platforms was FTX, a popular crypto exchange that became famous for its bold marketing campaigns.

The FTX cryptocurrency exchange experienced a sudden and dramatic downfall, filing for bankruptcy just days after being one of the largest in the world. The cause of this meltdown was revealed in a balance sheet of FTX’s sister company, Alameda Research.

The balance sheet indicated that Alameda had made substantial investments in FTT tokens, the native cryptocurrency of the FTX exchange. This sparked concerns of potential mismanagement of funds among investors, leading to a mass withdrawal of funds and, ultimately, the collapse of the exchange.

This incident serves as a reminder of the importance of transparency in handling user funds within the cryptocurrency industry. In light of this, Binance, the leading cryptocurrency exchange, has decided to implement a policy of regularly publishing proof-of-reserves reports, with other exchange platforms following suit. This is intended to ensure that clients can independently verify the exchange’s financial status and ensure the safety of their funds.

What is Proof of Reserves?

Proof of reserves is cryptocurrency exchanges’ method to demonstrate that they have the necessary funds to cover all customer deposits. This is an essential factor of transparency and security in the cryptocurrency industry, as it helps to ensure that customers’ funds are safe and the exchange is financially stable.

By publishing proof of reserves, an exchange provides a snapshot of its financial situation and allows customers to verify its solvency. This helps to build trust between the exchange and its customers and also helps to prevent fraud or insolvency.

There are different ways that an exchange can publish proof of reserves, such as by providing a signed message from the exchange’s wallet address or having an independent auditor conduct an audit. Regardless of the method used, it is critical that the exchange is transparent about its reserves and that customers can independently verify the information provided.

The frequency of proof of reserve updates can vary depending on the project or organization. Some projects may update their proof of reserves daily, while others may update them weekly or monthly. It’s recommended to check the project’s website or whitepaper for more information on the specific frequency of their reserve updates.

Cryptocurrency exchanges that have published proof of reserves

Binance, one of the leading crypto exchanges, was the first to publish its Proof of Reserves (PoR) following the collapse of FTX. The audit provided a clear and transparent breakdown of the top six assets out of the 600 assets held on the exchange. These assets included Bitcoin, Ethereum, Binance Coin, Binance USD, Tether, and USD Coin. Binance has nearly $70 billion worth of assets stored in cold storage.

Second in line was Bitfinex, one of the oldest crypto exchanges in the market, which published its PoR on November 11. The exchange reported that it had $5.06 billion worth of assets, with $3.36 billion in Bitcoin. The remaining assets were held in Ethereum, USDT, and USDC and were stored in 135 cold and hot wallet addresses. The exchange also announced plans to revive Antani, its open-source custody solution, and proof-of-solvency.

OKX published its Proof of Reserves on November 23. The exchange stated that it would continue to post regular PoR audit reports for users to verify the status of their holdings at any time. The PoR audit reported that most of its holdings were stablecoins, including USDT and USDC. However, according to Defi Llama, an aggregator for Decentralized Finance, the exchange also holds 91,000 Bitcoins. OKX uses the Merkle Tree approach for the verification of its assets. The exchange has also created a proof of reserves page where users can audit reserves to ensure they are solvent.

Huobi, a Seychelles-based crypto exchange, published its PoR audit on November 12. Defi Llama reported that the trading platform held 43,200 BTC, worth approximately $3.11 billion. In addition, the exchange also has Ethereum, USDT, and TRX tokens. The platform also possesses assets from other chains such as Avalanche, Algorand, Solana, Polygon, EOS, and Litecoin; these altcoins make up only a tiny portion of the total reserve.

Unlike many others, Gate.io was the first crypto exchange to provide a proof of reserves audit. In 2020, the exchange partnered with leading U.S. accounting firm Armanino LLP to audit its assets in reserve. Per a brief report published by Armanino, the exchange has 108 percent of BTC and 104 percent of ETH in its reserves as of October 19. This means that the reserves exceed user deposits, which is a positive sign. Recently, prompted by the FTX, Gate.io integrated Merkle Trees into its PoR and made the source code public on GitHub for other exchanges to benefit from their progress.

Kraken is another crypto exchange publishing proof of reserve audits before the concept was brought into the limelight by Binance. Like Gate.io, Kraken partnered with Armanino LLP and released its second proof of reserve in February 2022.

It is clear that while some exchanges have already been conducting proof of reserve audits before the FTX saga, the rest have decided to jump on board to avoid similar consequences.


The recent collapse of FTX has led to increased pressure on U.S. regulators to ensure crypto firms and exchanges comply with investor protection laws. Although the audit doesn’t reveal any details regarding hidden liabilities an exchange might have, PoR is still seen as a positive change that holds promise for users and investors. As technology advances, it may become more popular and offer complete transparency.  

Investors are now cautious about placing their funds in exchanges, particularly following the FTX meltdown. Whether PoR can fulfill its promise and achieve its goals is questionable in this environment.

* The information in this article and the links provided are for general information purposes only and should not constitute any financial or investment advice. We advise you to do your own research or consult a professional before making financial decisions. Please acknowledge that we are not responsible for any loss caused by any information present on this website.
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