Kraken recently completed its latest Proof of Reserves, providing clients with a way to verify that their account balances are fully backed by on-chain assets.

This verification process, performed by an independent third-party accounting firm, is based on a snapshot taken on September 30, 2024. The attestation is intended to demonstrate that Kraken securely holds client assets for supported cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term.

Kraken Attests $21.5 Billion Assets

This latest Proof of Reserves attestation covered six widely held assets on Kraken’s platform: Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term, Ethereum, Solana, USD Coin, Tether, and XRP. The assessment included clients’ spot and margin positions, futures balances, and on-chain staked amounts of eligible assets, specifically ETH and SOL.

In total, the attestation accounted for over $21.5 billion in client assets. Kraken made these results available on November 1, 2024.

Kraken introduced the Proof of Reserves system in 2014 and has committed to regular attestations since January 2022. The process is designed to reassure clients that Kraken’s holdings are fully reserved with in-kind assets.

Clients who held any of the supported assets as of the snapshot date can personally verify their balances are backed by logging into their Kraken Pro accounts.

2024 Proof of Reserves has been completed by @krakenfx

Our latest Proof of Reserves covered the most widely held cryptocurrencies on the platform. It included the spot positions, open margin positions, futures balances and on-chain staked amounts of eligible assets. In total,…

— Nick Percoco (@c7five) November 4, 2024

Merkle Tree Ensures Verification

To conduct the Proof of Reserves, Kraken sums all client liabilities and provides a method for clients to verify that their account and balance details were included in this total. A third party then attests to Kraken’s control over on-chain assets in amounts that exceed these liabilities.

The process uses a Merkle Tree to represent individual account balances through encrypted, unique hashes. These hashes are combined into a single Merkle root hash that represents the total client balances covered.

This approach allows for verification without exposing unencrypted data. Kraken again engaged The Network Firm, a registered CPA firm specializing in cryptocurrency attestation, to confirm it has control over the wallets holding these client balances.

“As with our previous Proof of Reserves, clients can now download the full path within the Merkle Tree, from their account to the root. They can review its construction, gain a better understanding of how Kraken’s Proof of Reserves process works and personally verify the value and validity of the root hash included in the report,” Kraken stated.