Binance Expands Its Proof-of-Reserves: Everything You Need to Know

Binance Boosts Its Crypto Reserves

On March 7, cryptocurrency fans were in for a treat as Binance announced the expansion of its proof-of-reserves (PoR) report by adding 11 new tokens. If you were worried that your precious crypto was hiding under the mattress, rest easy knowing Binance has now got you covered!

The Exciting New Additions

The new tokens making their way into Binance’s PoR include:

• Mask Network (MASK)
• Enjin Coin (ENJ)
• WazirX (WRX)
• The Graph (GRT)
• Chromia (CHR)
• Curve DAO Token (CRV)
• 1inch Network (1INCH)
• PowerPool (CVP)
• Hashflow (HFT)
• SSV.network (SSV)
• Dogecoin (DOGE)

With these additions, Binance now boasts over $63 billion across 24 different assets. So yeah, they’re not just playing around with pocket change!

Top Dogs in the Binance Kennel

Some of the heavyweight tokens on Binance include:

• Bitcoin (BTC): $12.7 billion
• Ethereum (ETH): $7.1 billion
• Tether (USDT): $16.3 billion

It’s like a crypto Olympics, and these three are securing the gold, silver, and bronze medals!

Proof-of-Reserves: More Than Just a Fancy Term

Since the unfortunate fallout from the FTX debacle, many exchanges, including Binance, have adopted this PoR method to add a layer of transparency. But before you start throwing your coins at them, experts have cautioned against some limitations of this method.

The Limitations of PoR

While it sounds great on paper, there are some caveats:

• Leverage and Collateralization: PoR doesn’t exactly shed light on how much leverage exchanges are using or how they collateralize their assets.
• Proof-of-Liabilities: It’s all fun and games until someone asks about proof-of-liabilities, which is usually not included unless they also provide their financial statements.

The Technical Wizardry Behind PoR

According to Binance, their PoR utilizes something called Merkle trees to sum up on-chain data. This makes it sound way cooler than it probably is, but it does give users some confidence that their assets aren’t just floating around in the crypto ether!

Additionally, Binance has recently implemented ZK-SNARKs to enhance the privacy and security of user data during the verification process. Talk about trying to keep things under wraps!

Audit Rollercoaster

In a twist of events, auditor Mazars previously removed Binance’s PoR audit from its site and halted its services for crypto exchanges. They claimed on December 7 that Binance’s Bitcoin reserves were “fully collateralized,” but remember, folks, that this was based on agreed-upon procedures—not a full-blown financial audit.

So, while they might be flexing hard with these reserves, always read the fine print!