The post Binance’s Latest Proof-of-Reserve Report Under Scrutiny for Transparency appeared first on Coinpedia Fintech News
Binance Exchange, a prominent player in the cryptocurrency world, has released its 10th Proof-of-Reserve (PoR) report, a critical financial disclosure in the crypto sphere. While shedding light on the holdings of various digital currencies, particularly XRP, the report has raised concerns among industry analysts regarding transparency.
Analysis of Binance’s PoR Data
Binance’s PoR report reveals that the combined XRP user base totals an impressive 2,587,670,373.002 units. More strikingly, Binance currently holds a whopping 2,686,407,725.227 units of XRP. Notably, the XRP reserve ratio stands at a robust 103.82%, indicating that Binance maintains more XRP than necessary to meet user demands. This information offers valuable insights into Binance’s reserves and its preparedness to cater to user needs.
Despite Binance’s proactive stance on sharing reservation reports, a practice that gained traction after issues at the FTX derivatives exchange, some industry experts remain skeptical about the level of transparency.
Travis Kling, co-founder of Ikigai Funds, has raised concerns about Binance’s honesty, suggesting that not all accounts should be counted as money in use. He argues that the exchange rate doesn’t directly control all funds. Kling highlights the absence of proof of customer debt in Binance’s report, a surprising omission in the industry, especially considering Binance’s legal battle with the U.S. SEC (Securities and Exchange Commission).
However, it’s worth noting that Binance, along with exchanges like OKX, does provide these reports and maintains 105% reserves for Bitcoin and Ethereum, signaling a commitment to financial stability.
These trust issues emerge amid Binance’s ongoing legal challenges with the SEC, indicating a potentially challenging road ahead for the exchange.
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