Proof of reserves

A published attestation that a custodian holds assets corresponding to customer balances, usually via a cryptographic commitment to the liability set plus evidence of controlled addresses.

Why it matters

Proof of reserves demonstrates assets. On its own it does not demonstrate solvency, because it says nothing about liabilities outside the attested set — borrowings, obligations to other parties, or off-chain debt. A reserves attestation without a corresponding liabilities attestation is a partial picture.

What you can check

A reserves attestation shows assets at a moment in time. On its own it says nothing about liabilities, and nothing about whether the assets were borrowed for the snapshot. The useful questions are whether liabilities were included, who attested, and whether the exercise repeats on a schedule.

Where it showed up

Records in the Incident Tracker that turn on this: Mt. Gox collapse.