Binance Confirms Asset Coverage for Users

The cryptocurrency exchange Binance has released the audit results of its reserves, asserting an over-collateralization of client funds.

As of February 1, the company held 609,477 BTC and 4,353,718 ETH. User deposits in leading cryptocurrencies amounted to 594,688 BTC and 4,163,085 ETH, with coverage reaching 102% and 104%, respectively.

In the stablecoin USDT, coverage was 120%, while for USDC it was 149%.

The minimum coverage value for the 31 assets reported was recorded at 100.01% for the CRV token of the decentralized exchange Curve Finance.

“When we talk about proof of reserves, we specifically mean the assets we hold for users. This means we provide evidence that Binance has funds that cover all our clients’ assets 1:1, plus some surplus,” the company stated.

To verify reserves, Binance employs zero-knowledge proof technology, zk-SNARK.

In November 2022, Binance was the first among centralized exchanges to launch the Proof-of-Reserves initiative, prompted by a loss of trust following the collapse of FTX. Subsequently, similar projects were implemented by Bitget, OKX, Gate.io, and Huobi.

Some experts have questioned the effectiveness of such audits, noting that the figures do not necessarily indicate the security of user assets.