Cryptocurrency exchange Bitget states that their overall proof-of-reserve ratio has reached 223%. In a July 13 announcement, Bitget revealed that its total reserve is currently $1.44 billion, spread across 31 different cryptoassets. The reserve ratios for Bitcoin (BTC), Tether (USDT), Ether (ETH), and USD Coin (USDC) are 454%, 135%, 171%, and 2,604%, respectively.
In an interview, Bitget executives told Cointelegraph that the exchange “operates without depending on debt or user funds for its transactions or investments” and that the company “prides on being debt-free.” The company wrote:
“Bitget has no outstanding debt or liabilities and is not listed as a creditor to any recently bankrupt company.”
When asked about the high collateral for select coins, the exchange explained that the money came from gains from transaction fees and returns from investments and acquisitions. The exchange has no external insurance for its users; It does, however, run a $300 million user protection fund that executives claim works better than liability insurance:
“This allows us to efficiently secure users’ assets without depending on external bureaucracy or policy changes.”
Although not yet required by law, Bitget would like to increase the number of partnerships with external auditors to audit its assets and reserves. The exchange updates its reserve statement every month.
While proof of reserves has become popular as a means of disseminating information about exchange assets following the collapse of cryptocurrency exchange FTX, experts warn of its effectiveness. Jack Graves, a law professor at Syracuse University, previously warned, “You can check how many assets a crypto exchange has on-chain, but how much of that is pledged as collateral?” It’s a lot harder to figure out if you don’t has access to their financial services, books and records.”
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