After Binance shared its proof of reserve this week, cryptocurrency exchange Bybit released its own. The platform said it would particularly focus on transparency to assure its customers that their assets are secure.
Bybit wants to maintain the trust of its customers
Singapore-based crypto-trading exchange, Bybit, has released its Proof of Reserve (Por). Platform clients can now check their asset balance, balance and ownership of exchange wallet addresses as well as the reserve ratio of the company.
What is Proof of Reserves (PoR)?
Proof of Reserves allows exchanges to be 100% transparent with their customers and to consolidate their trust. After the collapse of FTX, many exchanges started sharing their proof of reserve like Binance for example.
Proof of Reserves definition
Proof of Reserves is a method that uses both cryptographic evidence and ownership of public wallet addresses to verify that a platform holds enough cryptocurrency to cover the deposits and withdrawals of those customers. The exchange platform then calls on a third-party auditor who will have to ensure that the platform indeed has the cryptos that it declares to hold on behalf of its customers.
This allows the cryptocurrency platform to reassure its customers and also to assure them that there are real cryptocurrencies that guarantee the assets of the users.
Bybit Proof of Reserves
Bybit’s Proof of Reserves confirmed that the platform did indeed hold its clients’ assets at a 1:1 ratio that it claimed to have before the audit. This method helps address transparency concerns about cryptocurrencies held in centralized platform reserves.
Bybit’s audit also showed that its Bitcoin (BTC) and Ethereum (ETH) reserve ratios stood at 101% while USDT and USDC were at 102 and 103% respectively. The audit revealed that the Bybit exchange platform had a BTC balance of 20,710 or approximately $355.7 million and 156,064 ETH or $199 million at the time of the audit publication.
The crypto exchange said its customers will be able to validate many things through proof of reserves, such as being able to verify ownership as well as the balance of wallet addresses they own on the platform.
The FTX case has clearly led the crypto industry to make even more effort to consolidate the trust of its users and to assert their transparency. Many cryptocurrency platforms such as Kraken, Coinbase, Crypto.com or Binance have each shared their Proof of Reserves following the collapse of FTX at the beginning of last month.