Binance launches proof-of-reserves system for Bitcoin reserves

The largest cryptocurrency exchange in the world, Binance, has launched a new website to describe its proof-of-reserves method and is beginning with Bitcoin (BTC) reserves.

Currently, the company's reserve ratio is 101 percent. According to TechCrunch, this shows that it has enough BTCs on hand to cover each user's balance.

With the new proof-of-reserves website, the crypto exchange company confirmed that its own money is not included in the BTC wallets used in the proof-of-reserves system.

"It is important to note that this does not include Binance's corporate holdings, which are kept on a completely separate ledger," the company was quoted as saying in the report.

Regarding user assets, the business creates a cryptographic seal using a Merkle tree that contains all individual user accounts.

A few weeks ago, the crypto exchange company began by sharing wallet addresses for cryptocurrency assets worth billions of dollars.

The company demonstrated with this action that it does own a lot of assets and is capable of processing a ton of withdrawals, the report said.

However, Binance didn't make it clear whether those assets are from users, or of its own balance sheet, or a combination of both.

With inputs from Agencies.