BitMEX exchange has announced the launch of its proof of liability (POL) system. As a result, all BitMEX depositors can now confirm that their liability is included in the total exchange liability amount. The POL is a self-verification procedure that can be carried out without the involvement of a third-party auditor.
According to the blog post on the BitMEX website, their customers’ privacy is protected as account balances are randomly distributed into numerous Merkle tree leaves. In addition, snapshots of reserves and liabilities will be published twice a week (Tuesdays and Thursdays).
Proof of Liability?
Proof of Liabilitiy (PoL) is a system designed to allow companies that accept monetary deposits from consumers (e.g., Crypto exchanges, gambling websites, digital wallets, and so on) to show the entire amount of deposits (their liabilities) without compromising individual users’ privacy.
To self-verify liabilities, customers can use either their “account Nonce” for numerous snapshots or just the “nonce” for a single snapshot in the leaves of the Merkle tree.
All they need to do is to log into a BitMEX account and find the nonces, which are now given to all BitMEX depositorThe “My Account” page, as shown in the figure below, is where you may find the nonces after logging into your BitMEX account.
BitMEX is one of the top crypto derivatives exchanges that invented the Perpetual Swap. It was built by financial experts with more than 40 years of combined expertise. In addition, BitMEX provides a full API and auxiliary tools.
The BitMEX exchange was launched in 2014 by founders Arthur Hayes, Benjamin Delo, and Samuel Reed with the goal of building a pure futures contract trading platform. For the first time in the cryptocurrency world, BitMEX implemented perpetual swap contracts in 2016. Regarding trading volume, it is still one of the biggest digital asset derivatives exchanges.
Read Also: What is Proof of Reserve?