Since 2022 began, the crypto industry has witnessed a number of incidents related to security breaches. Three Arrows Capital was accused of diverting client funds and faced a liquidity crisis; FTX also suffered a run that led to a liquidity shortage as it misused user assets. To date, many individual and institutional investors are still unable to get their money back from Three Arrows Capital and FTX.
Crypto technology used to receive praise when it was invented and was said to be the trust machine that would enable complete information transparency. However, after more than a decade since the birth of Bitcoin, today the crypto industry is accused of frequent fraud and lack of transparency.
In the face of recent crypto scandals, CoinEx has taken swift action to come up with a plan to help users better understand the transparency of CoinEx assets and launched Proof of Reserve to reassure all investors and promote the sustainable and healthy development of the cryptocurrency. crypto industry. Currently, CoinEx Proof of Reserve covers BTC, ETH, CET, USDT, USDC, and SHIB. In the future, more cryptos will be covered.
What is Proof of Reserve?
Proof of Reserve is a way of auditing assets. It employs immutable technical measures to verify whether a platform has enough assets on-chain to support the book assets of its users.
CoinEx uses the Merkel Tree to prove that the exchange’s reservation rate is 100%. Specifically, this audit methodology requires three key steps for verification:
CoinEx uses the Merkle Tree as a data structure to encrypt user assets and publish the total assets of all users at the same time. Each CoinEx user can check if their account assets are included in the Merkle tree to verify the authenticity of the data;
CoinEx displays the total assets of all on-chain wallet addresses and wallets held by the exchange, and users can verify ownership of CoinEx addresses through relevant tools;
By comparing the total assets of all users to the total assets of all addresses in the chain on CoinEx, users can check the CoinEx asset reserve rate.
When the total on-chain assets on CoinEx are equal to or greater than the total assets of users, this shows that CoinEx maintains a 100% booking rate. In that case, all account balances are backed by real assets and CoinEx has not misused user assets.
Currently, users can verify CoinEx’s Proof of Reserve by clicking on the “Proof of Reserve” tab in the navigation bar at the bottom of the CoinEx website or “Proof of Reserve” on the main page of the CoinEx website. CoinEx app. Also, users can also follow the step-by-step guides in the Help Center to verify if CoinEx owns the addresses and if their assets are included in the Merkle Tree.
Look now at the CoinEx Proof of Reserve.
How to verify ownership of CoinEx wallet address.
How to check if my assets are in the Merkle Tree.
Keep user assets safe and build a crypto trust system
As a long-term believer in crypto technology, CoinEx aims to preserve the interest of its users with the best products and services, growing together with the industry and investors. To that end, the exchange has always considered asset safety as its bottom line. Since its creation in 2017, CoinEx has not suffered any security breaches. This record of zero accidents is maintained thanks to an extremely stable system protected by comprehensive measures. Furthermore, CoinEx has promised to maintain a 100% reserve rate and has delivered on that promise. On the exchange, user assets are never misused for any reason and all withdrawal requests are processed in a timely manner.
CoinEx launched its Proof of Reserve to prevent manipulation, increase trust in crypto through transparency, and mitigate security risks facing the industry. In the future, CoinEx will not disappoint users who have always trusted and supported the exchange.
We will continue to maintain the 100% booking rate and rigorously implement all security procedures and criteria. With the aim of facilitating crypto trading, CoinEx will protect the interest and assets of more investors and build trust in crypto to enable the healthy development of the industry and provide users with a safe, trustworthy and transparent investment environment.
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