• Binance, the largest crypto exchange by trade volume, manages $66 billion in crypto assets.
• Exchanges are releasing proof-of-reserve lists to provide insight into the large sums of cryptocurrency they hold in custody.
• The SEC is closely monitoring proof-of-reserves.

The crypto industry has seen a lot of upheaval in recent months, and the incident involving Alameda Research’s balance sheet and FTX’s subsequent bankruptcy filing have prompted many major crypto exchanges to publish proof-of-reserves and lists of known addresses. This is to provide users with the ability to verify the solvency of the trading platforms. Binance, the largest crypto exchange by trade volume, manages $66 billion in crypto assets, which is more than 6% of the entire cryptocurrency economy’s net value of $1 trillion.

Proof-of-reserve lists provide transparency into the cryptocurrency holdings of major exchanges. These lists can show the current balance of an exchange’s crypto assets, as well as the percentage of the total cryptocurrency market capitalization that the exchange holds. While these lists are not always reliable, they do provide some insight into the large sums of cryptocurrency held in custody by major exchanges.

However, there has been criticism from crypto industry members over specific types of proof-of-reserves lists and how they are audited. Paul Munter, the U.S. Securities and Exchange Commission’s (SEC) acting chief accountant, recently stated that the SEC is closely monitoring proof-of-reserves. This is to ensure that the cryptocurrency holdings reported by exchanges are accurate.

At the same time, users should remain vigilant when it comes to verifying the solvency of an exchange. Many exchanges have implemented various security measures, such as two-factor authentication, to help protect users‘ funds. Additionally, users should always research an exchange before depositing any funds and make sure to read the terms and conditions of the platform they are using. By doing this, users can ensure that their funds are secure and that they are using a reliable exchange.