Cryptocurrency exchange OKX revealed $7.5 billion in Bitcoin (BTC), Ether (ETH) and Tether (USDT) reserves as part of its monthly Proof of Reserves (PoR) report. According to data from blockchain analytics firm CryptoQuant, OKX claims to have the “largest pools of clean assets among major exchanges.”
OKX claims to hold 1:1 reserves, which would mean the company’s on-chain assets match 100% customer balances. The report shows current reserve rates of 105% for BTC, 105% for ETH, and 101% for USDT.
The term “clean” is used in reserve testing to describe crypto assets that do not include an exchange’s platform tokens and are comprised solely of high-market-cap crypto assets, such as BTC, ETH, and USDT.
CryptoQuant monitors PoRs across the industry. The company defines a clean reserve as:
“A clean reserve is the total reserve of each exchange, excluding the exchange’s native token. There may be a risk to the liquidity of the exchange if a self-issued token holds a significant percentage of the total reserve amount. Therefore, we have applied the clean reserve to visualize the liquidity of each exchange in a transparent way.”
Related: Proof of Reserves Is Increasingly Effective, But Not All Its Challenges Are Technical
The analytics firm concluded that OKX’s assets were 100% clean. The PoR report, which is available on the OKX website, includes historical data on reserve and liability ratios. According to the company, it has published more than 23,000 addresses as part of its Merkle Tree PoR program “and will continue to use these addresses to allow the public to view asset flows.”
Many in the industry are calling for more detailed liquidity disclosures using proof-of-reserve reports since the FTX crash in November 2022. Many crypto exchanges have since released third-party reports, including Binance, KuCoin, Crypto. com and Bitfinex.
Two accounting firms, Mazars and Armanino, removed crypto services from their portfolios in December, leaving exchanges without audit coverage at a crucial time. Armanino was the audit firm for FTX and has faced pressure from non-crypto clients after failing to detect issues at the now-bankrupt firm.
This post OKX Declares $7.5B in Liquid Assets in Proof of Reserves Report
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