Proof of reserves vs proof of custody
"Proof of reserves" is widely cited but widely misunderstood. It is not the same as proving an operator controls the funds, or that it can cover what it owes you. Here's the distinction that matters before you deposit.
Proof of reserves: assets exist
Proof of reserves (PoR) demonstrates, on-chain, that crypto sits at wallets associated with an operator. Because blockchains are public, anyone can read those balances — no trust in the operator's word required. It answers "do the assets exist?" It does not answer who controls them or how much is owed to players.
Proof of custody & liabilities: the harder questions
Proof of custody would show the operator exclusively controls the keys to those wallets — a reserve wallet can be borrowed, shared, or shown temporarily to look healthy. And neither proves liabilities: the total balance owed to all players. An operator can hold real reserves and still be insolvent if it owes more than it holds. PoR is necessary but not sufficient.
Side by side
| Question | Proof of reserves | Proof of custody / solvency |
|---|---|---|
| Do the assets exist on-chain? | Yes — verifiable | — |
| Does the operator exclusively control them? | No | Hard to prove on-chain |
| Do reserves exceed what players are owed? | No (liabilities unknown) | Requires audited liabilities |
| Can it be faked with temporary funding? | Partially (watch the trend) | Harder |
This is why we show reserves as a coverage level over time, paired with net flow — never a single "fully reserved" claim.
How exchanges learned this the hard way
The reserves-vs-custody gap is not theoretical — it is exactly how several large crypto exchanges failed. They showed (or implied) healthy balances while quietly lending out, double-counting, or commingling customer funds, so the assets "existed" on paper but were not really there for customers. After those collapses, Merkle-tree proof-of-reserves became standard for exchanges precisely to prove the assets exist and map to customer liabilities. Casinos are earlier on that curve: most show no proof at all, which is why independently reading their on-chain wallets is currently the best a player can do.
Liabilities: the number nobody publishes
The hardest figure to get is the one that decides solvency: total player balances owed. It lives in the operator's private database, not on-chain, so no outside party can verify it directly. This is the structural limit of any casino "proof of reserves": you can see assets, never the full debt. The practical workaround is to read reserves relative to observable activity — if mapped reserves dwarf recent withdrawal flow and stay stable, the operator is very unlikely to be unable to pay near-term withdrawals, even though you cannot prove total solvency.
What this means before you deposit
Treat a healthy reserve figure as a strong positive signal, not a guarantee. The most useful version is reserves tracked over time against withdrawal outflow, so a temporary top-up stands out and a steady decline is visible. See live mapped reserves in the proof-of-reserves hub and the method in proof of reserves explained. 18+; play responsibly.
FAQ
Proof of reserves shows assets exist at on-chain wallets associated with an operator. Proof of custody would additionally show the operator exclusively controls those keys. Neither proves liabilities (what is owed to players), so neither alone proves solvency.
No. It proves assets are held, not that they exceed total player liabilities or that the operator solely controls them. It is a strong positive signal best read as a trend over time alongside net flow, not a solvency guarantee.
Because solvency compares assets to liabilities, and liabilities — the total balances owed to all players — live in the operator's private database, not on-chain. You can verify what a casino holds, never the full amount it owes, so on-chain data establishes a strong floor on assets but not complete solvency.
A wallet can be funded temporarily to look healthy for a snapshot, which is why a single reading is weak. Reading reserves as a trend over time against withdrawal outflow exposes temporary top-ups and steady declines, making a one-off dress-up much harder to pass off.
Methodology & disclaimer. Figures are derived from on-chain transfers attributed to wallets we associate with each operator, plus third-party ratings shown with their source. Blockchain attribution carries inherent uncertainty, and reserves are an all-chain best-effort estimate from mapped wallets — coverage varies by operator. These pages describe observed activity and third-party data only; they are not an endorsement of any operator and not a statement on any operator's solvency, legality, fairness, or safety, and nothing here is financial, legal or investment advice. See how we attribute on-chain activity · about us · report a correction. Data updates roughly every 30 minutes. 18+ only. Gambling can be addictive — see responsible gambling resources.