OKX Releases Proof-of-Reserves Report with $8.6B in Crypto
According to the Proof-of-Reserves report from the Seychelles-based cryptocurrency exchange OKX, the firm is overcollateralized, with deposit ratios of 104% ETH, 104% BTC, and 102% USDT.
Moreover, the Nansen dashboard highlighted that out of the $8.6 billion holdings, $4.853 billion were in Bitcoin (BTC), $3.382 billion were in Ether (ETH), and $1.999 billion were in U.S. dollars.
Notably, data from CryptoQuant supported OKX’s assertion that its asset is clean. In other words, rather than the exchange’s native token, the reserves of the cryptocurrency exchange are solely made up of digital assets with high market caps.
OKX also stated in a blog post on its main website that more than 90,000 people visited the Proof of Liabilities page, and 175K visitors perused the Proof-of-Reserves section. Additionally, OKX reported around $8.5 billion in reserves in February, an almost 15% increase over the $7.5 billion reported in January.
On the other hand, Lennix Lai, Managing Director of Financial Markets at OKX, commented on the blog post by emphasizing that Proof-of-Reserves is not a technical term. He added that the OKX team must continue to hold its position as a market leader to acquire users’ trust.
The Proof-of-Reserves
Proof-of-Reserves is a report that a custodian generates, and it includes a list of crypto assets that are held on behalf of its users. The report assures that the custodian’s users’ assets are safe and secure. To generate this report, OKX uses a technique called the Merkle tree (hash tree), which enables the verification of the authenticity and accuracy of the data.
The Merkle tree is a data structure used to store information in a way that enables quick verification of data integrity. Moreover, it is a hash tree where each node is the hash of its child nodes. With this setup, data verification is fast and easy.
While creating Proof-of-Reserves, OKX uses the Merkle tree in two distinct methods. Firstly, the OKX balance tree lets members view their balance and provide evidence that their funds are included in the overall OKX fund. Thanks to this, users may confirm that OKX is in charge of holding their assets.
The second step in calculating Proof-of-Reserves involves comparing the overall OKX value to the OKX on-chain wallet balance as it is publicly known. By comparing the two, users may confirm that OKX’s total holdings are consistent with those in the on-chain wallet.
OKB market insights
OKB, OKX’s native cryptocurrency, is now trading at $52.86, up 0.6% on the day, according to data from Coinmarketcap. In addition, in the previous 24 hours, OKB’s market value has climbed to $3.16 billion, a 0.6% gain, while trading volume has decreased to $71 million, a 0.33% decline.
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