Proof of reserves (PoR) is a report that aims to show an exchange holds enough assets to cover customer balances. A common method publishes a Merkle tree of customer balances so you can check your own balance is included, alongside wallet addresses or an attestation of the exchange’s holdings.
What to look for
- How often the report is published.
- Whether an independent firm was involved.
- Whether liabilities are included, not only assets.
- Which assets are covered.
Limits
A snapshot shows the position on one date. It does not always show all liabilities, and it is not the same as a full financial audit.