Proof of reserves
For better investor protection & transparency
Although originally from the traditional financial industry, CoinShares decided in 2013 to devote fully to digital assets because those new protocols allow for unparalleled transparency in transactions, contracts, and operation of protocols. With this in mind, CoinShares has partnered with The Network Firm and its solution LedgerLens to provide investors with real-time transparency.
CoinShares has partnered with The Network Firm and its solution LedgerLens to provide investors with real-time transparency.
What is proof of reserves?
Proof of reserves is an attestation service via The Network Firm LedgerLens solution. This blockchain-enabled solution allows investors to independently verify the crypto asset backing through viewable and downloadable attest reports that are generated daily.
How does it work?
This application leverages blockchain technology to independently verify the amount of crypto physically backing the ETP matches the Issuer's liabilities. This unique application allows CoinShares to advance the industry by adding another layer of transparency to its ETP product suite.
For CoinShares Physical ETPs, the procedures detailed herein and the accountant’s findings are intended to demonstrate that, at the time the procedures were performed, the Issuer held in custody and controlled digital assets equal to the Coin Entitlement¹ of outstanding Securities. In short, the procedures are intended to demonstrate that the Securities in issue are adequately backed by the underlying digital assets held by the Issuer.
For XBT Provider ETPs, the procedures detailed herein, and he accountant’s findings, are intended to demonstrate that, at the time the procedures were performed, CoinShares custodied and controlled a number of digital assets (both “physical” or “custodied” digital assets and “synthetic ” assets comprised of derivatives and lending positions for Bitcoin and Ethereum) with a USD equivalent value greater than or equal to the USD equivalent value of total XBT Provider ETNs issued and outstanding. In short, the procedures are intended to demonstrate that the notes are adequately collateralized by the hedge.