Kraken’s Audit shows that the exchange holds up to $19 billion in both ETH and BTC and also allows clients to verify their accounts using third-party services so let’s find out some more in today’s latest crypto news.
The leading crypto exchange Kraken announced the results of the proof of reserve audit and showed that it holds over $19 billion worth of ETH and BTC. According to the blog post, Kraken’s audit was conducted by Armanino LLP which is a technology company in the US and the results didn’t include other assets aside from BTC and ETH. This is the second independent audit conducted on the exchange in about six years and according to Armanino, the auditor took a few years of work to reconstruct a Merkle Tree which is a data structure that encapsulates hashes of blocks of data and proves each coin is in its spot.
The audit came as crypto companies are facing a lot of scrutiny from regulatory bodies across the world. According to Jeremy Welch, the chief product officer at Kraken, the exchange plans to conduct public proof of reserve audits every year. Welch said:
“Security and transparency for our customers has been at the core of our culture as a company, and the core of our practices and operations from the very beginning. Regular Proof of Reserves audits will demonstrate that, for Kraken, our client security and safety are a top priority.”
The exchange is also implementing auditing standards to allow clients and verify that their BTC and ETH balances are backed by real assets that are held in the exchange’s custody so any client will be able to verify the balances by comparing the pieces of data in the Merkle root. The verification will reflect the current state of the supported assets when the audit was performed. Noah Buxton who is a blockcahin practice lead at Armanino said:
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“We offer Proof of Reserves because we’re passionate about this industry, and believe it is the future of finance and capital markets. With this audit, we’re taking historical best practices from certified public accounting firms and applying them in a new way that’s incredibly exciting.”
Kraken was also one of the few companies in the industry that has been so active but what’s more, it is now is working on an NFT marketplace with new features like allowing customers to use NFts as collateral to borrow funds against.
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