Crypto exchange OKX has revealed the state of its balance sheet today to prove to customers it has not been gambling with their cash, as the industry scrambles to restore confidence in the wake of FTX’s collapse.
OKX was among a host of crypto firms to commit to publishing ‘proof of reserves’ amid allegations that Sam Bankman-Fried’s failed FTX exchange had been funnelling customer cash into its sister trading firm.
Seychelles-based OKX, the world’s second-largest crypto exchange by trading volume, is allowing customers to prove that their assets are backed 1:1 by the firm. The firm has also published its proof of reserve audits and its latest reserve ratios across tokens.
The world’s biggest exchange Binance and Singaporean bourse Crypto.com are among the other major firms offering customers a look at their books to try and restore confidence and prevent a rush of withdrawals.
OKX director of financial markets Lennix Lai said it was now also conducting “third party audits” to try and reassure customers.
“We believe that a far greater degree of transparency needs to be brought to our industry to allow us to build back stronger after recent events,” Lai said.
The move from OKX comes one day after FTX faced fresh questions over its use of customer funds, as court documents revealed bosses and afflialiates of the firm had splurged nearly $121m on property in the Bahamas over the past two years.
Lawyers representing FTX, hired after 30 year-old Bankman-Fried was ousted, said the firm was run like a “personal fiefdom” for its founder.