2023-02-27 15:41:55
Welcome back to H3RO3S Academy’s Marvellous Merit Monday
A PoR audit is one that aims to ensure that custodians are holding their clients’ funds in full. Custodial businesses in cryptocurrency use PoR audits to prove to depositors and the public that their deposits match their balances.
These audits are conducted by independent third parties to eliminate the possibility of reserve data being falsified.
PoR is essential for several reasons. Firstly, it enables users to verify that the balances they hold on a cryptocurrency exchange, for instance, have absolute asset backing.
Secondly, it drives businesses to meet transparency standards, making it difficult for them to engage in questionable or illegal financial activity.
Ideally, PoR should benefit both users and businesses. It protects users by minimising security risks and safeguarding against harmful players. At the same time, it helps businesses retain users by increasing their trustworthiness.
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