Backed Integrates Chainlink Proof of Reserve for Transparent Asset Collateralization
Backed, a leading fintech innovator, recently announced its integration of Chainlink Proof of Reserve (PoR). This strategic move aims to provide users with a transparent and trust-minimized mechanism to validate the collateralization of their tokenized assets. The integration reinforces user trust and ensures the integrity of tokenized assets.
Behind the Curtains of Backed’s Proof of Reserves Solution
When users purchase bTokens from Backed, the company promptly acquires the corresponding underlying asset as collateral. This process involves transmitting an acquisition order to their broker, and the tokens are issued to the user within minutes. Backed’s auditing prowess is driven by The Network Firm, which has read-only access to Backed’s custody bank accounts and continuously monitors account balances.
In-transit securities are meticulously recorded as distinct data, and this information is transparently conveyed to Backed’s Swiss custodian. Chainlink Proof of Reserve’s decentralized oracle network verifies this aggregate data, updating daily or when there’s a significant fluctuation in reserve volume.
Backed Ensures On-Chain Accessibility of Data
Backed ensures that this consolidated data is accessible both on their website and on-chain, offering a compelling Proof of Reserves solution for their products. Co-founder Adam Levi emphasized the importance of verifiable, on-chain data in proving full collateralization. The Chainlink PoR mechanism enables smart contracts to accurately determine collateralization levels for on-chain assets supported by off-chain reserves.
The Benefits of Chainlink PoR System
The Chainlink PoR system provides real-time verification of collateral using a decentralized network of oracles. It prevents unexpected fractional reserve practices and fraudulent activities, offering users enhanced assurance and transparency in asset collateralization. By automating verification on the blockchain, the system goes beyond paper assurances and ensures a higher level of confidence in asset backing.
Hot Take: Backed Enhances Trust and Transparency with Chainlink PoR Integration
Backed’s integration of Chainlink Proof of Reserve marks a significant milestone in its goal to create fully collateralized and verifiably backed products. With the implementation of this transparent mechanism, users can independently verify the sufficiency of collateral reserves for their tokenized assets. This move strengthens user trust and reinforces Backed’s commitment to providing secure and reliable financial services in the crypto space.
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