The cryptocurrency platform OKX, announced its Proof of Reserve is now live. OKX disclosed that one of their greatest responsibility and priority is to ensure users’ funds are safe and secured. The platform also mentioned that it will always maintain 1:1 reserves to empower its users with greater transparency than ever.
With the FTX saga which left users in the crypto space with doubt (FUD), OKX mentioned that their Proof of Reserve is a “verify” not “trust.” Earlier in the week, the Binance CEO revealed in an AMA session that Vitalik Buterin, co-founder of Ethereum, was planning on creating a Proof of Reserve protocol for the industry. Interestingly, OKX has gone ahead to launch its first Proof of Reserve.
Following the launch, all OKX on-chain wallet holdings were made public to allow users to verify their funds and confirm they are backed 1:1 by real assets.
OKX defined Proof of Reserves as a standard audit method used to ensure a custodian holds sufficient funds to cover all assets on their exchange.
According to OKX, Proof of Reserve, audits will be published regularly, making it easier for users to verify their assets are safely held in reserve. “Moving forward, we’ll conduct regular Proof of Reserve audits to update our collateral balance and the status of your assets within our reserves,” OKX said.
The new feature on OKX will support Bitcoin (BTC), Ethereum (ETH), and USDT. OKX, however, assures more assets will be added over time. Current PoR analysis on the OKX platform shows that BTC and ETH reserve ratio is 102%, while USDT is 101%. This means that OKX controlled USDT, BTC, and ETH of user holdings in excess of 100%.
OKX uses a verification method known as a “Merkle tree.” A Merkle tree is a data structure designed to encrypt data and verify all the user assets held on an exchange.
OKX identified that they verify ownership of OKX on-chain wallet addresses and the total OKX wallet holdings. Also, they verify the reserve ratio by comparing total user asset holdings with total exchange assets from their on-chain wallet addresses.
How to verify your asset balance has been included in the OKX Merkle tree
- Log in to your OKX account.
- Navigate to “my audit,”
- Click “Details.” Your audit data will be displayed.
- Click on “Copy data” to get the data you need for verification
- Paste and save the data as a JSON file. Afterward, run the open-source OKX verification tool “MerkleValidator.”
Note: If the data passes verification, the result “Merkle tree path validation passed” will be shown. This means the assets are in the OKX Merkle tree snapshot. If verification fails, the result “Merkle tree path validation failed” will be shown, which suggests otherwise.
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