OKX, the world’s second-largest crypto exchange by trading volume, today published its third monthly Proof of Reserves (PoR), showing $7.5 billion in clean assets.
A Proof of Reserves report verifies that the custodian holds the assets it claims to hold on behalf of its customers.
OKX’s asset reserves can be considered clean when they do not include its native token. In this case, OKB. Instead, their reserves show holdings of Bitcoin (BTC), Ethereum (ETH), and the stablecoin, USDT. All of which are coins with significant market cap and trading volume.
Blockchain analytics firm CryptoQuant monitors PoR across the industry and found OKX’s assets to be “100% clean.” This is the first monthly PoR report published by OKX.
Their CMO, Haider Rafique, said: “Security, transparency, and trust are core tenets of the OKX business process and customer service philosophy. We’ve already taken a leadership position by publishing our PoR monthly. As industry standards for PoR continue to take shape, we expect that our reserve asset quality will be one of many key differentiating factors for OKX in the market.”
The OKX PoR protocol is open source and available to the public on GitHub. Additional OKX holdings can be viewed on the OKX Nansen Dashboard.
OKX has said that it will continue to publish monthly PoR reports. The crypto industry has demanded similar action from all custodians of funds to avoid another FTX happening again.
CryptoQuant Found OKX’s Assets to Be 100% Clean
To prove solvency, exchanges shouldn’t hold substantial amounts of their own native token in reserves. Native tokens are tokens created by the exchange itself. They are often used as a governance mechanism and to provide incentives to use their product.
The collapse of FTX was sparked by a report by CoinDesk’s Ian Allison on FTX’s native token, FTT. He found that Alameda Research, a trading firm founded by Bankman-Fried and tied to FTX, held significant amounts of FTT on its balance sheet.
Binance’s CEO tweeted shortly after that it would sell all of its remaining FTT. Confidence in the token collapsed, and the FTX house of cards tumbled shortly after.
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.