Binance Releases 12th Proof of Reserve Report – Is It Enough to Restore Trust?
Cryptocurrency exchange Binance has released its twelfth proof of reserve report, providing transparency into its reserves during a period of market instability. The latest report, with a snapshot date of November 1st, 2023, was calculated and verified by independent Chinese journalist Colin Wu.
- Bitcoin holdings decreased 0.7% from October to 584,659, with reserves 104.22% of customer balances.
- Ethereum holdings increased 2.2% to 3.92 million, with reserves 105.2% of customer balances.
- BNB holdings increased 6.4% to 31.22 million, with reserves 111.41% of customer balances.
- USDT holdings decreased 0.2% to 15.27 billion, with reserves 118.83% of customer balances.
The proof of reserve report aims to reassure users that Binance has sufficient cryptocurrency reserves to cover all customer balances and liabilities. This has become increasingly important amidst recent volatility and uncertainty in crypto markets that have led to liquidity issues at some exchanges.
Other coin holdings
Binance USD (BUSD)
- Customer Net Balances: 835,359,336 BUSD
- Binance Net Balances: 1,116,058,372 BUSD
- Reserves Ratio: 133.60%
USD Coin (USDC)
- Customer Net Balances: 918,194,516 USDC
- Binance Net Balances: 952,207,696 USDC
- Reserves Ratio: 103.70%
Litecoin (LTC)
- Customer Net Balances: 5,569,377 LTC
- Binance Net Balances: 5,649,004 LTC
- Reserves Ratio: 101.43%
XRP
- Customer Net Balances: 2,659,549,227 XRP
- Binance Net Balances: 2,770,726,176 XRP
- Reserves Ratio: 104.18%
Solana (SOL)
- Customer Net Balances: 26,642,841 SOL
- Binance Net Balances: 27,245,703 SOL
- Reserves Ratio: 102.26%
Chainlink (LINK)
- Customer Net Balances: 52,451,368 LINK
- Net Balances: 54,590,278 LINK
- Reserves Ratio: 104.08%
Binance utilizes Merkle Tree cryptography to generate these reports. All customer net balances are consolidated into a Merkle Root, which acts as a cryptographic seal summarizing account balances on the snapshot date. An independent auditor then verifies that the balances match the exchange’s liabilities.
For now, the transparency reports offer traders peered insights into the exchange’s inner financial workings during turbulent times. The community had lost trust in centralized exchanges following the collapse of FTX in 2022. Reports like proof-of-reserves are a light at the end of the tunnel to ensure that there are enough reserves to back the customer balances.
