Crypto.com discloses partial reserves in bid to counter insolvency rumors

Chris Marsalek Tweeted details of Crypto.com reserves to address bankruptcy rumors.

According to Marszalek, the company holds 53,024 bitcoins, 391,564 ethereum and other crypto assets totaling around $3 billion.

He added that this represents a “small fraction of our reserves”, with a reserve proof audit currently underway and cold wallet address sharing expected soon.

At today’s prices, the disclosed reserves total about $4.4 billion.

proof of reserve

Following the collapse of FTX, crypto platforms have come under increasing pressure to disclose their asset reserves. is to cancel out the

Several major exchanges such as Binance, Huobi, OKX and KuCoin have agreed to release proof of reserves in the coming days and weeks.

In this regard, on November 8, Binance CEO Changpeng Zhao (CZ) touched on the issue of cryptocurrency exchanges using fractional reserve accounting, overvaluing their assets. He added that the industry should not follow conventions set by the banking sector.

CZ said Binance is up to the task and will release its Merkle Tree Proof of Reserves soon.

A Merkle tree references a data structure. Authenticated by cryptographic means. Presumably, this method of disclosing stockpile evidence would present an untamperable audit trail.

crypto dot com

Glassnode data shows Crypto.com has a Bitcoin balance of around 53,000 BTC, consistent with Marszalek’s claims. However, it was noted that its holdings spiked to this level just before the partial disclosure was made.

As noted by Dirty Bubble Media (DBM) regarding claims for real-time audit assets by rival exchange Nexo, the disclosures provided failed to give a complete picture of the actual health of the company’s balance sheet. .

For example, DBM raised several points including the statement “assets exceed liabilities”. DBM said there was no disclosure of the extent to which assets exceeded liabilities in this instance.

So, transposing the point of DBM across the cryptocurrency industry, an exchange’s verified assets alone may not be sufficient to prove solvency.

After Marszalek released a partial disclosure statement on Crypto.com’s reserves, the CRO token fell sharply.