Proof of Reserve, the platform developed by Chainlink to ensure transparency and verifiability in asset management, integrates with Ark Invest and 21Shares' Bitcoin ETF, ARKB.
Fund managers Ark Invest and 21Shares, which are among 10 approved by the US SEC to launch a Bitcoin spot ETF, are adopting Chainlink’s Proof of Reserve solution to improve transparency and trust in their Bitcoin exchange-traded fund.
Ophelia Snyder, co-founder and president of 21Shares, highlighted that the strategic partnership with Chainlink will allow the company to offer an unprecedented level of transparency to 21Shares Bitcoin ARK (ARKB) investors, while improving trust and integrating an additional layer of security into asset management.
Through Proof of Reserve, Ark Invest and 21Shares will bring the reserve data of their Bitcoin spot ETF to the blockchain, Indian Snyder.
Transparency for ARKB investors
The integration of Chainlink’s Proof of Reserve solution into Ark Invest and 21Shares’ Bitcoin exchange-traded fund comes at a time when trust has become a key element in cryptoasset investment, especially since the approval of spot ETFs, which have marked a turning point for investment in the main and largest cryptocurrency on the market.
In early February, Bitwise became the first Bitcoin ETF issuer to make its holdings of the cryptocurrency public, in an effort to increase transparency and investor confidence. Bitwise, the issuer of the Bitwise Bitcoin ETF (BITB), shared the wallet address where it stores the bitcoins held in reserve for its investment fund. While this has put the company in the middle of the review, because it used a legacy BTC address and not a multisig, Bitwise also earned several plaudits for taking “a first step toward greater public transparency.”
Now, Ark Invest and 21Shares are the next to move toward transparency of the reserves backing one of the leading Bitcoin funds on the market.
“Through the integration of Chainlink’s market-leading Proof of Reserve solution, 21Shares offers clear visibility into ARKB’s Bitcoin reserves,” the asset manager said in a statement.
According to data from Bitcoin Treasuries, the ARKB is The third of the new Bitcoin spot ETFs approved in the United States, with a total of 33.924 BTC in reserves, at the time of this writing. Therefore, in addition to transparency, the companies have also focused on security, integrating reinforced measures that allow them to guarantee investors the integrity of the assets under management. “Enhanced security measures, including segregated wallets, multi-signature protocols, and cold storage, ensure that these holdings are transparent but secure, maintaining the integrity of the assets and generating confidence in investors,” the company indicated.
Security, trust and decentralization
Chainlink is the leading decentralized oracle network in the blockchain ecosystem. Launched in 2019, the network enables decentralized application (DApp) developers to integrate real-world data into the blockchain, expanding the technology’s applications and use cases and fostering the development of more complex smart contracts and solutions.
Through its platform Proof of ReserveChainlink seeks to improve the tracking and verifiability of assets in reserve, allowing fund issuers to prove the true collateralization of their assets, whether on or off the blockchain. The platform replaces manual asset verification processes by integrating automation, thereby also improving speed and efficiency, while reducing costs and risk.
In addition to Ark Invest and 21Shares, other prominent projects in the cryptocurrency world make use of the Proof of Reserve platform, such as Bitcoin Wrapped (WBTC), Gemini and Paxos.
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