November 14, 2022
New Report Highlights Proof of Reserves Importance for Bitcoin Businesses
A new report from the Bitcoin Policy Institute (BPI) shows just how important proving custodian reserves is for the Bitcoin economy. Using features built into the Bitcoin protocol, custodians can rebuild credibility with clients, regulators, and investors in the crypto market.
Nearly all the fallout in crypto markets over the past year can be traced back to one thing: repeated failure by custodians to prove their reserves. Billions of dollars of investor capital and client funds that have been destroyed from this negligence have drawn even more scrutiny from lawmakers and regulators. But top-down changes from lawmakers aren’t the only fix. Nor are they necessarily ones that the Bitcoin economy should hope for.
A growing number of exchanges have promised to do this after the ongoing series of custodial catastrophes in 2022, and with investor panic and regulator scrutiny both soaring, this trend can be expected to continue growing. Importantly, Hoseki is building the tools to help these businesses.
More stringent regulation may be on the horizon. But using Bitcoin as it’s designed without relying on government pressure should be our goal. Proof of Reserves accomplishes this. Bitcoin won’t be the future of money if we don’t make ourselves accountable. Custodians showing Proof of Reserves is non-negotiable.
Click here to read find he full Proof-of-Reserves report by BPI.
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