Binance, OKX sets transparency standards and reports as Coinbase lag with POR: CQ

A new report from CryptoQuant ranks transparency based on its Proof of Storage (POR) practices based on transparency in five major crypto exchanges.

Analysis shows that Binance is in the lead, while other players such as Bybit, Okx, Kraken and Coinbase are also lagging behind.

POR ranking

The survey evaluates the reserve ratio for each exchange, which is calculated by dividing the net customer balance by the total balance of the platform. Binance ranks first in transparency, always keeping coverage above 100%, and publishing its POR report in a timely manner every month.

OKX follows right after that, and also reports a capital support rate that is still above 100%. However, the number is slightly lower than binary. The exchange also releases its disclosures monthly without delay.

Bybit is next on the list, with a reserve ratio between 105% and 115%. The platform recently improved its disclosure practices by moving from bimonthly reports to monthly reports.

Kraken ranked fourth in crypto, and the exchange maintained a backup number of more than 100%. However, since November 22, 2022, it has released only four reports, and the CQ analysis highlights the need for more regular updates.

Since the exchange has not released any POR reports yet, Coinbase ranks last. Analyst Maartun describes this trend as a major drawback, especially given the company’s size and market position.

Coinbase cannot disclose reserves

The encryption quick example points out that Binance and OKX are currently setting industry standards because of their strong reserve range and consistently reporting on time.

While some gaps need to be filled, Bybitt and Cleken are also making progress. However, Coinbase stands out and is the only exchange among the five reviews that have not yet provided any POR data.

Saving proofs is a method used by crypto exchanges to show that they hold enough digital assets to cover customer deposits. Transparency measures have become popular among institutions after the crash of big crypto platforms such as FTX and Gox, leaving investors unsure whether their funds are safe.

Despite the increasing adoption, this practice has also been criticized by some well-known crypto industry numbers. Michael Saylor of strategy recently called it a “bad idea.” He believes that disclosing wallet addresses, usually part of the POR process, introduces serious security risks.

According to Bitcoin enthusiasts, no professional security team recommends making the wallet structure public. He further claimed that if AI is asked to assess the risks posed by the practice, it will create a potential threat of 50 pages.