Crypto Exchange OKX Releases Second Proof-of-Reserves Report

Digital currency trading platform OKX has released its second Proof-of-Reserve (PoR) report as it seeks to deepen the trust within its ecosystem with respect to the health of its financials. The released PoR aims to show the community and investors that the exchange has the number of deposits it said it has. This proof also shows it can fulfill all withdrawal obligations without running into a liquidity crisis.

The implosion and subsequent bankruptcy filing of FTX Derivatives Exchange have pushed a host of exchanges on the path whereby they voluntarily push for enhanced transparency in their activities. Scared of the community’s reaction to the collapse of the FTX which was adjudged by many to be one of the healthiest in the industry until early November pushed OKX to join the bandwagon in publishing its PoR last month.

Unlike many in the space, however, OKX has now decided the report will be monthly and that its users can download the monthly report to verify its claims.

“Publishing PoR results on a monthly basis strengthens our commitment to lead the industry when it comes to transparency and trust,” Chief Marketing Officer Haider Rafique said in the release. “At OKX, we believe that PoR should be verifiable via open source tools so that users can self-verify the balances and ownership of our reserve addresses.”

OKX said the report will be published on the 22nd day of each month and besides the latest version of the report, users will also be able to download past reports at their convenience. According to the digital currency trading platform, all of its 23,000 addresses can now be audited by anyone, adding to the layer of trust that it said it has worked hard to build over the years.

The OKX Proof-of-Reserve Report

In the report, OKX said it has a balance of 113,754 Bitcoin ($1.87 billion) in its wallet as of Tuesday 12:00 UTC. This figure comes against a user balance of 112,192 Bitcoin (BTC) giving the premier asset a 101% reserve ratio. The reserve ratio for Ethereum (ETH) comes in at 103% as user balances on the exchange were pegged at 1,091,007 as against the 1,124,295 held by the trading platform.

USDT also has a substantial reserve ratio of 101% atop a user balance of 3,118,778,203 and an OKX wallet balance of 3,137,965,012. According to a review of the exchange’s addresses by Nansen, it was discovered that the trio of Bitcoin, Ethereum, and USDT makes up about 90% of all holdings.

This cannot be likened to concentration risk as exchanges nowadays have features for easy transfer of value from one asset to the other. With the plan to be publishing the report every month, OKX has set a new standard for transparency that users may demand from all other trading platforms.