Stablecoins, RWA & Tokenization

What is proof of reserves and how does it work?

Proof of reserves is a verification method that demonstrates a platform actually holds the assets it claims to hold on behalf of its users. It typically works by combining on-chain evidence of the platform's wallet holdings with a tally of user balances, often using cryptographic techniques so the total can be checked without exposing individual accounts. For example, an exchange might publish wallet addresses and a verifiable record of customer liabilities so anyone can compare assets against obligations. Proof of reserves shows balances at a point in time and does not by itself confirm liabilities held off-chain, so its rigor depends on how completely it is implemented.

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