Proof-of-reserve system launched by Binance
Binance’s improved proof-of-reserves (PoR) system is based on zero-knowledge proofs and improves exchange speed while reducing computational costs.
The Binance proof-of-reserves (PoR) system has undergone significant updates today. Users will benefit from improved security, privacy, and reliability. As part of the updates, the PoR system will be made more efficient and cost-effective, and four new tokens will be added to the existing 13 tokens.
Zk-SNARK, a zero-knowledge-proof technology, has been implemented in the PoR system, improving its security. Binance is trying out this technology for the first time. Over time, the company plans to make it even better. Binance has collaborated with Polyhedra Network to ensure zk-SNARK implementation.
Binance has made its PoR system open source
Binance’s proof-of-reserve system is now open source, which means that any crypto exchange can use it and ensure its transparency. The Binance GitHub page contains the source code, licensing, documentation, and more.
Binance is setting a new standard for transparency with this latest move. Exchanges will no longer have to spend money developing their own solutions or paying for third-party services, such as Hacken’s zero-knowledge PoR system, which was launched in 2022.
Binance collaborates with Polyhedra Network to enhance its POR system
Binance delves into the implementation of zk-SNARK and how it improves the current PoR system in an official blog post. The article also discusses zero-knowledge proofs and how they can improve proof of reserve systems. There will also be an Academy article with a more detailed explanation.
Binance users can now verify that the exchange fully backs their funds thanks to updates to the PoR system. External third-party organizations will also be able to verify the exchange’s entire reserve. However, the data provided is not real-time but rather based on snapshots.
The PoR system’s data integrity has been significantly increased thanks to Polyhedra Network. According to PolyhedraZK, cryptographic assumptions that are challenging to crack computationally ensure the security of zero-knowledge proofs. The PoR system uses cryptographic technologies that have been used in numerous other systems and are regarded as secure.
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