Coinbase explores proof of reserves launches developer grants

New York City: Coinbase has made the announcement that it is thrilled to see how far it can go in the industry with on-chain accounting and is investigating new methods to verify reserves. Coinbase is excited to see how far it can go in the industry with on-chain accounting. In addition to that, they launched a grant program for developers with a total value of $500,000 to inspire others.

People gave FTX their money and their faith in a recent scandal, but both were quickly lost due to the exchange’s fraudulent activities. Because of the consequent liquidity concerns, several cryptocurrency businesses are having trouble keeping up with the demand for their products. Regarding the exchange’s reserves and liabilities, there has been a lack of openness throughout this process. As a consequence of this, a debate on the sector’s need for increased evidence of reserves has been ignited.

Businesses have a variety of options available to them for establishing the assets and liabilities of an exchange. Some of them involve more time-honored practices, while others are more contemporary.

When it comes to its financials, Coinbase, which is a publicly traded firm and has been audited, claims to follow a conventional strategy. The usage of cryptography is included inside this strategy as well. They are required to submit yearly financial reports to the Securities and Exchange Commission, and their books are checked over on a consistent basis by an independent auditor.

The random sampling of addresses that they claim to possess is being done by the external auditor so that we can verify who really owns our cold storage reserves. They will then demand that the monies be transferred as evidence of ownership.

Coinbase began recording cryptocurrency assets as part of their liabilities on their balance sheet at the beginning of the second quarter of this year. They did so because they found that SAB 121 was successful in achieving their goals.

Coinbase also made the announcement that they aim to test the limits of what is possible in this market with regard to on-chain accounting. There is a need for a continual evidence of solvency that is resilient and able to survive off-chain occurrences that might have an impact on the asset’s sustainability. They will probably accomplish this goal by using a Zero Knowledge PoRL.

The failure of FTX may have had some positive outcomes, one of which was that it brought attention to how vital it is for different cryptocurrency companies to be transparent about their assets and liabilities. Coinbase asserts that they are dedicated to offering the highest level of customer care that is humanly feasible.

Coinbase is also announcing a new developer grant program as a way to demonstrate their dedication to the development of on-chain accounting. The program will provide a total of $500,000 to support teams and individuals who are working on the development of new technologies and methods that can improve the efficiency of on-chain accounting. Among them are the use of Zero Knowledge PoRLs and other methods that protect users’ privacy.