Binance continues to lead the cryptocurrency landscape with its recent Proof of Reserves (PoR) audit, spotlighting Ethereum (ETH) and Solana (SOL) on June 1. As a pivotal player in the crypto exchange universe, Binance reiterates its commitment to ensuring customer assets are fully backed at a precise 1:1 ratio. Intriguingly, the audit reveals that the exchange does not hold additional reserves of ETH and SOL beyond customer deposits. This adherence to maintaining user fund security opens up discussions about the exchange’s strategy for asset management and prioritization.
Understanding Binance’s ETH and SOL Reserves
A recent analysis by MartyParty via X (formerly Twitter) highlights the findings from Binance’s June audit. Utilizing zk-SNARK cryptography, the report confirms that the Ethereum and Solana balances are nearly equal to user deposits, reflecting a precise snapshot of the exchange’s liability to its customers. Ethereum currently sits at 5,337,118.325 ETH in total holdings, closely aligning with customer balances at 5,337,110.337 ETH.
Similarly, Solana displays a similar trend, with Binance retaining 23,017,153.973 SOL against customer deposits of 23,017,150.874 SOL, yielding a complete reserve ratio of 100.00%. This statistic not only signifies Binance’s compliance in backing user funds but potentially indicates a strategy of not keeping surplus reserves in these specific cryptocurrencies.
While this practice aligns with Binance’s transparency, the lack of additional ETH or SOL could point to a targeted approach in reserve allocation towards different digital assets. This decision may be influenced by fluctuating user interests or consider overall treasury management, notably when juxtaposed with the more substantial holdings of other cryptocurrencies.
Current Reserves: A Broader Perspective
Beyond Ethereum and Solana, Binance boasts a considerable stockpile of other notable assets, positioning itself advantageously in the liquidity department. Noteworthy among these are stablecoins, which dominate the reserve landscape. The exchange maintains a substantial backing with the following reserve ratios for stablecoins: BUSD at 161.86%, USDC at 153.01%, FDUSD at 112.86%, and USDT at 101.52%. This strategy suggests an inclination toward maintaining robust liquidity, providing stability in volatile market conditions.
Bitcoin also features prominently in the exchange’s reserves, totaling 606,080 BTC, which exceeds customer holdings of 593,411 BTC, leading to a reserve ratio of 102.13%. The audit also reveals overages in other cryptocurrencies like XRP and Shiba Inu (SHIB). The most substantial reserve ratios, however, are found in Litecoin (LTC), Binance Coin (BNB), and Dogecoin (DOGE).
LTC boasts an impressive 113.61% reserve ratio, with millions of extra coins held beyond user requirements. Furthermore, BNB possesses a 111.74% ratio, with around 7.33 million tokens backing 6.45 million customer deposits. Dogecoin rounds out the impressive reserve strategy, showing over-collateralization at 110.99%, with Binance holding 17.01 billion DOGE compared to customer deposits of 15.3 billion.
