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What is Proof of Reserves?

Proof of Reserves: a crypto term, explained in plain English.

In one line

A check an exchange publishes to show it holds enough crypto to cover every customer's balance, one for one.

Crypto Drafted with AI help · Reviewed by Keshav Aggarwal · Updated

In simple words

Imagine 100 friends each give you one marble to look after. To show you still have them all, you count the marbles in your jar in front of everyone. Each friend can also check that their own marble is on the list. Proof of reserves is that public count for a crypto exchange.

The technical side

An exchange lists the wallets it controls and compares their holdings with what customers hold on the platform. Each customer can check their own balance is included through a Merkle tree, and newer versions use zero-knowledge proofs (zk-SNARKs) so balances stay private. A proof is only a snapshot of one moment, and it cannot show debts kept off the list. On 29 October 2026, about $6.3 billion was drained from Binance hot wallets, including "Binance 14", a wallet named in its 1 October proof of reserves. Binance took a new snapshot on 4 November at 00:00 UTC, widened it from 10 to 44 tokens, and said about 98% of the losses had been replaced. See recent attacks on crypto hacks.

Proof of Reserves kya hai?

Exchange sabko dikhata hai ki uske paas customers ka poora crypto hai, ek-ek coin. Aap khud check kar sakte ho ki aapka balance list mein hai. Binance hack ke baad 4 Nov 2026 ko Binance ne isse 44 tokens tak badhaya.

Not investment advice. Crypto tokens can lose all their value. Read the risk disclaimer.

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