Key Points
- Binance has published its 22nd Proof-of-Reserve report showing a high reserve ratio for its digital assets.
- The report comes as a measure to maintain transparency and integrity in the wake of the FTX exchange collapse.
Binance, a leading cryptocurrency exchange, has made public its 22nd Proof-of-Reserve (PoR) report.
This report is released to uphold transparency and integrity, showing the assets in custody of the exchange’s users.
Binance’s Asset Reserves
Binance maintains a 1:1 hold on all user assets, with additional reserves, and boasts zero debt in its capital structure.
The exchange also ensures an emergency fund (SAFU fund) is in place for extreme cases.
The 22nd PoR reveals that users’ Bitcoin (BTC) comes to approximately 605,000 BTC, marking a 1.27% drop from the previous report.
Similarly, users’ Ethereum (ETH) assets amount to 4.486 million ETH, a decrease of 4.58%, equivalent to 225,000 ETH.
Conversely, users’ Tether (USDT) saw a 4.34% increase, with holdings increased by 919 million USDT to 22.11 billion units of the USD-pegged stablecoin.
The report also showed 32 million SOL in Solana reserves, and a net balance of 13.12 billion DOGE for Dogecoin customers.
The snapshot of these figures was taken on September 1, 2024.
Reserve Ratios and the PoR System
Binance’s reserve ratio stands at 106.84% for BTC assets, 103.68% for ETH, 100.09% for DOGE, 112.82% for USDT, and 102.67% for Solana (SOL) assets.
The exchange has also maintained an average of 100% ratio across all other digital currencies.
The PoR system was launched by Binance with BTC following the sudden collapse of the FTX crypto exchange in 2022.
In 2023, Binance launched a dedicated website for the process and began expanding to other crypto assets.
The collapse of FTX led to a significant liquidity crisis, causing the company to be unable to process withdrawals due to the high demand from end users and investors.
This resulted in losses worth billions of dollars for approximately 1 million creditors and a loss of trust in other crypto platforms and exchanges.
The introduction of a PoR system allowed crypto firms to alleviate these fears.
In the two years since, Binance has continuously upgraded the platform to ensure a smooth user experience and provide all the necessary information for effective crypto investment.
Other exchanges have begun to follow Binance’s lead in this regard.
At the end of Q1 2024, OKX published its 17th PoR report, showing a record BTC reserve of 102%, ETH 104%, USDT 106%, and USD 110%.
The report also showed that the exchange is overcollateralized and users’ assets are backed 1:1 on the platform.
In May, leading crypto exchange and Web3 innovator Gate.io published its PoR report showing a reserve-deposit ratio of 115.34% and a total reserve value of $6.49 billion.
The report covered about 209 digital assets, marking an increase of 20 since the previous report.
Binance also regularly increases its asset size, a trend that has strengthened its position as the top exchange in the market.
