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What is Proof of Reserve — and how to verify it
Proof of Reserve (PoR) is verifiable evidence that a tokenized asset is fully backed by the reserves it claims — ideally attested by an independent third party and checkable on-chain in real time, not merely stated in a PDF.
Why it matters
A tokenized asset is only as trustworthy as the reserves behind it. Proof of Reserve is the difference between “trust us” and “verify it.” Without it, you are relying on the issuer's word that real gold, treasuries or cash exists to redeem your token.
Types of proof, weakest to strongest
1) Self-reported dashboard — the issuer publishes a number with no independent check. 2) Periodic third-party attestation — an accounting firm confirms reserves monthly or quarterly and publishes a report. 3) Real-time on-chain Proof of Reserve — an oracle (e.g. Chainlink PoR) posts reserves on-chain so anyone, and even other smart contracts, can reconcile reserves against the token's circulating supply continuously.
How to verify it yourself
Find the issuer's reserves or transparency page. Check who attests and how often, and whether the report is public and current. For on-chain PoR, read the feed and compare the attested reserve to the token's total supply — they should reconcile 1:1 or better. If you can only find a marketing claim with no source, treat the backing as unverified.
How Claridex scores it
Reserve proof is the 25% gate pillar in the Claridex methodology. If reserve proof cannot be verified, a token is marked “not rated” — because for an asset-backed token, no verifiable reserve means no trust, regardless of how good the other pillars look.
FAQ
Is a PDF attestation enough?
It is far better than a self-reported number, but it is periodic and backward-looking. A real-time on-chain Proof-of-Reserve feed that reconciles to token supply is stronger.
What is Chainlink Proof of Reserve?
An on-chain oracle that publishes a project's reserve balance so anyone — or any smart contract — can verify that the tokens are backed, live, without trusting the issuer's dashboard.
Does Proof of Reserve prove the token is safe?
No. It shows reserves exist at the time of attestation. It does not capture liabilities, rehypothecation or legal encumbrances, so you should also check custody, audit and the issuer's legal structure.