Gate introduces Proof of Security standard claiming 104.58% cold reserve coverage
Cryptocurrency exchange Gate has rolled out a new Proof of Security framework claiming its cold reserves cover 104.58% of user balances, though reports have flagged concerns over its snapshot methodology and expanded asset definitions.
Cryptocurrency exchange Gate has introduced a security framework known as Proof of Security (PoSEC), designed to measure an exchange's resilience against catastrophic breaches. According to CoinDesk and Bitcoin.com News, the new standard tests whether an exchange could keep user balances whole if attackers drained its entire hot wallet. Gate reported that its cold storage holdings cover 104.58% of customer assets under the test.[1][2][3]
However, CryptoSlate reported that Gate's calculation relies on an altered definition of cold storage that incorporates stocks and U.S. Treasuries held by independent custodians. CryptoSlate also raised red flags over the methodology, noting that the hot-wallet loss test compares data across separate snapshot dates and measurement bases. Independent verification of the exchange's PoSEC figures remains in progress.[4][5]
Gate, which pioneered Proof of Reserves in 2020, framed the new model as an effort to address the limitations of traditional reserve audits following recent industry incidents, including a major exploit at Binance.[2][3]
Key facts
- Gate introduced the Proof of Security (PoSEC) framework to assess exchange resilience against major security breaches.
- The PoSEC model tests whether user assets would remain covered if an exchange's hot wallet were completely drained.
- Gate reported that its cold storage covers 104.58% of user assets.
- Gate's revised cold-storage definition includes stocks and U.S. Treasuries held by independent custodians.
- CryptoSlate reported that Gate's coverage calculation compares shares from separate snapshot dates and uses different measurement bases.
- Independent verification of Gate's current PoSEC data remains in progress.
- Gate pioneered Proof of Reserves in 2020 and developed PoSEC in response to reserve auditing limits highlighted by the Binance hack.
Sources · 5 sources
- CB
Crypto BriefingArticle ·
Gate introduces Proof of Security standard for crypto exchanges Gate's PoSEC framework could push crypto exchanges towards stronger security standards, emphasizing resilience against major breaches. The post Gate introduces Proof of Security standard for crypto exchanges appeared first on Crypto Briefing .
Open source - CO
CoinDesk@CoinDeskPost on X ·
INSIGHT: After the @Binance hack exposed the limits of Proof of Reserves, @Gate is pushing for something more: Proof of Security. Its new PoSEC standard asks a simple question, if hackers drained your entire hot wallet, would users still be covered? Gate says yes, with cold storage at 104.58% of user assets.
Open source - BC
Bitcoin.com News@BitcoinNewsPost on X ·
What if an exchange’s hot wallets are drained? @Gate’s new Proof of Security (PoSEC) shows its cold storage covers 104.58% of user balances. After pioneering PoR in 2020, Gate aims to raise security standards amid recent industry incidents. https://t.co/YBGpBbxasU
Open source - CR
CryptoSlate@CryptoSlatePost on X ·
Gate’s new cold-storage definition includes stocks and US Treasuries held by independent custodians. Its reported 104.58% coverage compares shares from separate snapshots. Independent verification is still in progress. via @pelicamatos https://t.co/AFZXTNv1w9
Open source - CR
CryptoSlateArticle ·
Gate boasts 104% cold reserve coverage, but separate snapshot dates raise red flags Its new hot-wallet loss test uses separate measurement bases, while independent verification of current PoSEC data remains in progress. Read the full story on CryptoSlate Understand the crypto stories that matter and what to watch next. Get The Catalyst in your inbox
Open source