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This week, two cryptocurrency exchanges provided proof of reserves to emphasize that the trading platforms are backing client assets 1:1. Binance published its report on December 7, 2022 and detailed the global auditor Mazars Group who performed the audit. On December 9, 2022, Crypto.com exchange released Proof of Reserves records and verification was also done by Mazars.
Binance and Crypto.com Reveal POR Audits
Two very large crypto exchanges provided proof of reserves (POR) documentation this week following promises made by exchange executives after the FTX fiasco. The world’s largest crypto exchange, by trading volume, Binance, has revealed a comprehensive overview of assets such as BTC, BTCB and BBTC hosted on the Mazars Group website which shows assets held on Bitcoin networks, Ethereum, BNB and Binance Smart Chain.
The Mazars audit took place on November 22, 2022, at a Bitcoin block height of 764,327, and the report claims that the assets are 101% backed by collateral reserves. “At the time of the assessment, Mazars observed that assets controlled by Binance exceeded 100% of their platform’s total liabilities,” the Mazars report states. “The collateralization ratio takes into account in-scope assets loaned through the provision of margining services and loans that are collateralized by out-of-scope assets. The Merkle root was compiled by hashing all customer accounts into a single output,” adds the Mazars audit.
Mazars’ audit of Binance further notes that “total liabilities” were considered in the attestation. In late November 2022, after Binance provided POR addresses, Kraken’s Jesse Powell criticized the evidence and said that “state of assets is useless without liabilities”. Powell also shared his two cents on Binance’s latest audit and blasted Binance’s POR again on December 8.
Following Binance’s publication of its POR audit reviewed by Mazars Group, crypto trading platform Crypto.com issued a press release regarding its POR audit which was also conducted by Mazars. “The Mazars Group has compared the assets held in [onchain] addresses found to be verified by Crypto.com with customer balances via a live query supervised by an auditor from a production database as of December 7, 2022, 00:00:00 UTC,” the company said.
Crypto.com clarified that existing customers can verify their assets on the platform. The full Crypto.com audit conducted by Mazars is available here. “Our report is solely intended to provide Crypto.com customers with additional transparency and assurance that their relevant assets are fully reserved, exist on the blockchain(s), and are under the control of Crypto.com within the reports mentioned below. date”, details the audit of Mazars.
Tags in this story 1:1, Assets, audit, bBTC, Bitcoin (BTC), BTC, BTCB, collateral ratio, Crypto, crypto assets, Crypto.com, Ethereum (ETH), POR exchange, Exchanges, Jesse Powell, Kraken Exec, Mazars, Mazars Group, PoR, POR Audit, Proof of Reserves, Total Liabilities, Transparency
What do you think of the publication of POR by Binance and Crypto.com and the audits carried out by the Mazars group? Let us know what you think about this topic in the comments section below.
Jamie Redman
Image credits: Shutterstock, Pixabay, Wiki Commons
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