Key takeaways PoR audits are cryptographic verifications used by cryptocurrency exchanges to prove they hold sufficient assets to cover customer deposits. Using methods like Merkle trees and zero-knowledge proofs, PoR ensures transparency, similar to how capital reserves are mandated in traditional finance for stability. Coinbase’s cbBTC uses PoR to verify that for every wrapped Bitcoin, an equivalent amount is securely held in Coinbase’s custody. PoR audits can verify asset holdings but do not account for liabilities, which can mislead users […]
