Binance releases its proof-of-reserves system, starting with BTC, claiming it has 582,485 BTC and 575,742 BTC user balance, a reserve ratio of 101% for users
Binance had first shared a wallet snapshot and said it would adopt a proof-of-reserves protocol associated with Vitalik Buterin; this release turns that effort into a BTC reserve-versus-user-balance disclosure. The reported surplus gives customers a public benchmark for Binance’s BTC custody claims.
Related coverage then supplied both validation and a boundary: Mazars reported 101% BTC collateralization, while a later report said the verification covered only a small set of financial data. That distinction matters because a reserve snapshot is narrower than a full assessment of obligations.
First-order effects
Binance publicly commits to a BTC reserve ratio claim based on 582,485 BTC in reserves against 575,742 BTC of user balances, making that calculation available for customer scrutiny.
BTC holders on Binance receive a stated custody benchmark, while Binance assumes the burden of defending the scope and accuracy of the disclosed figures.
Second-order effects
Mazars’ subsequent verification reinforces Binance’s stated BTC ratio, but the reported limits of that work prevent the document from serving as a broad account of Binance’s financial obligations.
The narrow-data criticism shifts attention from whether reserves exceed BTC user balances to which liabilities and financial data a proof-of-reserves process actually covers.
Third-order effects
The coverage establishes a durable divide between asset-reserve attestations and fuller liability verification; exchanges seeking trust through transparency will face pressure to address both sides of that divide.
If proof-of-reserves becomes a standard disclosure, its credibility will depend less on a headline reserve ratio than on consistent, clearly defined coverage of customer liabilities.
The trend: Crypto custody transparency is moving from wallet disclosures toward scrutiny of whether reserve attestations also establish the liabilities they are meant to secure.
I'm sorry but no. This is not PoR. This is either ignorance or intentional misrepresentation. The merkle tree is just hand wavey bullshit without an auditor to make sure you didn't include accounts with negative balances. The statement of assets is pointless without liabilities. …
I know it's hard. If you thought a fraudster is legit, you probably are already poor. But... If you believe FUD all the time, you will also likely to be poor. Life is not easy.
This is part of the Proof-of-Reserve Audit. The auditor require us to send a specific amount to ourselves to show we control the wallet. And the rest goes to a Change Address, which is a new address. In this case, the Input tx is big, and so is the Change. Ignore FUD! https://twi…
Love the dual messaging of its your fault for falling for scams but also your fault if you don't take advantage of get-rich-quick schemes. https://twitter.com/...
Yeah this alone makes me suggest you get your money out of binance. Or crypto in general. But this is a very weirdly specific statement I refuse to believe https://twitter.com/...
As part of our ongoing commitment to transparency, we have provided new updates on #Binance's Proof of Reserves. Further updates for $ETH, $USDT, $USDC, #BUSD & #BNB will be coming in the near future. Stay tuned.
In crypto: Brian A and Jesse P say FTX is an “overseas exchange” problem, even though SBF is American. I tweeted questions about Coinbase/Grayscale. Brian answered it. Jesse questions Binance's Proof-of-Reserves today. We will answer it. I view these as healthy checks.
Good on @jespow exposing @cz_binance's fake “Proof of Reserves” which has a lot of nuanced loopholes, constantly exploited by @binance and other centralized middleman exchanges, which isn't a problem for Real DeFi $HEX $PLS $PLSX because #PulseChain solves this lolz https://twitt…
Indeed. We're trying to reinvent the world with crypto, but proving solvency for a centralized exchange? There's a reasonable way to do that from tradfi, this is kind of worst of both worlds. It makes use of cryptography but to provide misleading conclusions. /1 https://twitter.c…
@gods_protege1 ... Listing out some wallets without proving you control them is not that valuable. PoR is about matching up assets vs liabilities and proving you control the assets. https://niccarter.info/...
Binance's system is useless and easily exploited by them. - Merkle tree wasn't shared - code for building the Merkle tree wasn't shared - no explanation of the treatment of liabilities/negative balances - zero evidence they actually control the addresses included in the tree http…
Great point from Jesse. Here's a simplified diagram explaining the problem in layman terms. In this example, three customers with 2,500 BTC each can independently verify their own balance, but the exchange only needs to sign 5,000 BTC instead of 7,500 by using a negative account.…
a great start (with only BTC for now) in having checks to prevent another FTX tier level of user deposits embezzlement from happening again https://twitter.com/...
Pointed out that reserves are over 100% which could be explained by profits being included. That's a good first step, but hopefully @cz_binance and team can clarify. Proof of reserves is a great first step but always good to question. https://www.binance.com/...
That's great but it doesn't really matter without understanding Binance's liabilities Just get a full audit done by a big 4 firm https://twitter.com/...