Bitstamp US Chief Calls Proof-of-Reserves Key to Restoring Trust in Exchanges

The Proof-of-Reserves (PoR) procedure can restore retail investors’ trust in exchange platforms. In an interview with The Block, Bitstamp US chief Bobby Zagotta said.

In the executive’s view, PoR provides clients with more information about how centralized platforms manage their customers’ assets.

“On the one hand, how many exchanges operate is rather opaque. On the other hand, blockchain technology creates the possibility for radical transparency. […] PoR will allow clients to see that the assets on the exchange exceed its liabilities,” he said.

Zagotta acknowledged that the current method is “not ideal” and is nothing more than a “snapshot.”

Earlier Kraken co-founder Jess Powell criticised Binance’s reserve-data audit. According to him, it makes no sense without including liabilities.

Earlier Ethereum founder Vitalik Buterin , with a view to increasing PoR efficiency, proposed to employ zk-SNARKs as part of the procedure.

Read ForkLog’s Bitcoin news on our Telegram — crypto news, prices and analytics.