Liabilities are measured as a part of an audit and added to the proof-of-reserves.
The trio of Coinbase, Gate.io, and Kraken have emerged as the first exchanges to publish their proof-of-reserves and liabilities in their recent audits.
The recent collapse of FTX has monumentally shaken up the cryptocurrency industry, and Changpeng Zhao, the CEO of Binance thinks every exchange should present a Merkle-tree proof-of-reserves to allay the fears of investors.
Although Zhao initiated this movement, Binance did not add its liabilities to its proof-of-reserves. While sharing his advice, Zhao did not suggest the disclosure of liabilities. Popular opinion however shows that disclosing liabilities is a commendable route to ensure full transparency.
Many exchanges have been publishing their proof-of-reserves with and without their liabilities.
Bitfinex like Binance also did not present its liabilities in its Merkle-tree proof of reserves. Similarly, the likes of ByBit and, MexcGlobal did not share their liabilities but have revealed their intention to publish proof-of-reserves subsequently.
Huobi and Crypto.com also published their proof-of-reserves, and have indicated that they are already working on their liability report which will be published subsequently. OKX is presently working on its proof-of-reserves soon to be published.
As originally reported in (https://cryptoslate.com/kraken-coinbase-and-gate-io-publish-proof-of-reserves-with-liabilities/)