PoR Badges Don't Guarantee Solvency: What They Prove and Miss
Crypto exchanges and custodians often display 'Proof of Reserves' (PoR) badges on their websites, but this doesn't necessarily mean they're solvent. PoR is a snapshot of an exchange's on-chain assets at a specific point in time, which can be useful but has its limitations.
According to CoinMarketCap's June 2026 Exchange Monthly Report, about $192.6 billion in exchange PoR was tracked, with USDT being the single largest reserve asset at roughly $57.6B and BTC around $55.5B. However, this data can be stale within days and is sensitive to timing.
Experts recommend treating PoR like live market data, not a certificate on the wall. A strong per-asset ratio in one token doesn't necessarily translate to another. For example, Phemex reported an average reserve ratio of 127.77% across BTC, ETH, USDT, and SOL, while MEXC's July update showed a BTC reserve ratio rising to 281%, covering 4,439.51 BTC of user holdings.
It's essential to consider the timing quirks around snapshots and trim exposure ahead of busy weekends. PoR helps but is only one piece of the trust puzzle. Limit venue risk by diversifying venues and keeping trade balances lean.