The largest cryptocurrency exchange in the world, Binance, has confirmed that every Bitcoin on the platform has been accounted for. By examining public blockchain information, users are able to verify the security of their Bitcoin balance. Mazars Veriitas, the auditing firm found that Binance’s Bitcoins were collateralized at a rate of 101% on November 22nd.
Mazars Veriitas also confirmed that Binance’s Bitcoin reserves were secured with an additional reserve of Bitcoins held in a multi-signature cold wallet. This reserve acts as an additional layer of security to ensure that user funds remain safe in the event of a hack.
The use of a multi-signature cold wallet also allows users to rest assured that their funds are not at risk of theft or loss due to internal mismanagement. By utilizing the multi-signature cold wallet, Binance’s Bitcoin reserves are further protected from potential malicious actors attempting to exploit vulnerabilities in the system.
The FTX collapse has made the cryptocurrency community much less trusting of exchanges lending customer deposits, causing proof of reserves to be adopted more widely.
