- OKX has more than enough Bitcoin, Ethereum, and Tether to redeem users.
- The exchange makes the data available on the blockchain for anyone to see.
- Most major exchanges have lower reserves. In December, Huobi had less than 59% of its assets as clean reserves. Binance had 89%.
OKX has more than enough Bitcoin, Ethereum, and Tether to cover withdrawals, the latest reserve report says. The exchange claims to have a better clean asset reserve ratio than other major exchanges.
The world’s second-largest crypto exchange holds $8.6 billion in Bitcoin (BTC), Ethereum (ETH), and Tether (USDT).
According to OKX’s latest Proof of Reserves (PoR) report for February 2023, the exchange holds more than enough of these tokens to redeem its users.
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In particular, the reserve rations are as follows: 104% for BTC, 104% for ETH, and 102% for USDT.
OKX has made this data available on the public blockchain using the “Merkle Tree” method. This allows anyone to verify all the user assets on the exchange.
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OKX reported significant user interest in that data. According to the exchange, some 175,000 unique users visited their PoR page, while 90,000 went to look at their liabilities.
Why Clean Reserves Matter
In December, CryptoQuant published clean reserve ratios for major exchanges to highlight their importance. OKX was the best performer, at 100%. Binance had 89% clean reserves, while Huobi had less than 59%.
“Clean reserves” refer to the number of reserves an exchange has that are not in their token. This is important because a lack of clean reserves can harm the exchange’s stability. CryptoQuant said that a lack of clean reserves played a part in FTX’s collapse.
“One of the major reasons FTX and Alameda failed was the large portion of their assets, FTT, held in reserves,” CryptoQuant wrote. “When the price of FTT collapsed, the value of the assets of FTX/Alameda (which were also pledged as collateral for loans) also plunged.”
On the Flipside
- US regulators are cracking down on centralized exchanges that are not transparent with their users.
- OKX’s proof of reserves shows that total user assets increased by $602 million. Bitcoin holdings on OKX increased by 9.9% in the last month.
Why You Should Care
Centralized exchanges still play an important role in the crypto space. Their stability affects the entire crypto market.
Learn more about the tools to track CEX reserves:
CoinMarketCap Introduces a Proof-of-Reserve (PoR) Tracker for Crypto Exchanges
Learn more about the Merkle Tree verification.
Top CEXes Promise Transparency with Merkle Tree Proof of Reserves
