As one of the largest and oldest Bitcoin crypto exchanges in the world since 2011, Kraken is consistently named as one of the best places to buy and sell cryptocurrencies online due to its excellent service, low fees, options versatile financing and rigorous security standards!
What is Proof of Reserves?
A crypto exchange’s proof of reserves (PoR) is an independent third-party audit that seeks to ensure that a custodian holds the assets it claims on behalf of its clients. A crypto exchange’s proof of reserves (PoR) is an independent third-party audit that seeks to ensure that a custodian holds the assets it claims on behalf of its clients.
From there, the auditor obtains a Merkle root: a cryptographic fingerprint that uniquely identifies the combination of these balances at the time the snapshot was created.
The auditor then collects digital signatures produced by Kraken, that prove ownership of on-chain addresses with publicly verifiable balances. Finally, the auditor compares and verifies that these balances exceed or match the customer balances represented in the Merkle tree, and therefore that the customer assets are held on a full reserve basis.
Any customer can independently check if his balance has been included in the “Proof of Reserves” audit by comparing certain data with the Merkle root. Any changes to the rest of the data, no matter how small, will affect the root – making manipulation obvious.
Kraken Audit Proof of Reserves
Kraken has released the results of its second 2022 Proof of Reserves audit, which has been expanded to include:
Note: * Indicates Proof of Reserves audit covered assets held both on Kraken’s spot exchange and staking platform
A “Proof of Reserve” audit is an innovative accounting procedure that cryptographically verifies cryptocurrency deposits and account balances. The results of the latest Kraken audit have been re-verified by global top 25 accounting firm, Armanino LLP. The audit determined that the exchange securely holds all of the above assets belonging to customers.
Kraken has always focused on security, and the latest audit allows customers who held these assets in the crypto exchange to independently verify that their Kraken balances are indeed backed by real assets backed by the global crypto exchange.
In the February 2022 audit, Kraken led the industry in verifying the balance of customers’ BTC and ETH deposits. The addition of five more top cryptocurrencies expands customer balance checking coverage to 63% of total assets held on Kraken, intending to include additional assets in future audits.
At Kraken, the security of funds is and will always be the number one goal, and regular “Proof of Reserves” audits demonstrate the ability of Kraken to create a higher standard of accountability and transparency – not just in crypto, but in the wider banking and financial space.
Also, the crypto exchange offers the necessary tools to check the balances, as well as the possibility to independently check the audit results:
Login to your account. Kraken
Follow this process in 3 simple steps to generate a “Registration ID” or “Merkle Leaf” specific to your Kraken account
Enter this “Registration ID” on the auditor website, Armanino LLP.
By following the process above, you will be able to claim that your cryptocurrencies By following the process above, you will be able to claim that your cryptocurrencies
If you don’t see a Registration ID or “Merkle Leaf” in your account.Kraken, do not worry. This means that you do not hold these assets on Kraken at the time of the audit and you will be able to check your account balances. in future audits.
If you would like to learn more about Proof of Reserves and the innovative ways in which the transparency of public blockchains is used, we invite you to learn more at Kraken.
As the crypto industry’s transparency leader, Kraken continues to raise the bar and set blockchain-based standards for accountability to its customers. Proof of Reserve audits provide a standard not only unmatched in crypto, but unmatched in traditional finance.