With increasing interest in digital assets, custody options have expanded to include self-custody, exchange wallets, and third-party custodians. Crypto custodians manage private keys and secure assets much like traditional finance. However, recent events, particularly the FTX collapse and Three Arrows Capital liquidation, have raised concerns about the reliability of custodians. To address these concerns, proof-of-reserves (PoR) audits have gained prominence, helping verify that custodians have sufficient reserves for their deposits. This article focuses on the importance of PoR audits and how they can be accessed and verified, emphasizing their critical role in building trust in the crypto industry.
Despite the rise in interest for digital assets, notable market failures like the FTX collapse have shaken trust in crypto custodians, highlighting the need for robust risk management.
Proof-of-reserves audits are essential in the crypto industry, ensuring that custodians maintain adequate reserves and protecting clients' interests amid growing scrutiny following significant market downturns.
Collection
[
|
...
]