CoinMarketCap has announced the launch of a new feature that will help track cryptocurrencies on a different level.
The firm has tried clearing out the ambiguity factor from the cryptocurrency industry that the investors complain about the reserves backing a crypto platform or asset.
CoinMarketCap is known for being a leading market tracker and researcher that has a vast knowledge of the cryptocurrency industry.
It focuses on providing as much information as possible when it comes to cryptocurrencies and the industry’s segments.
The New Feature
The new feature launched by CoinMarketCap is going to offer users the ability to track and look at insights from the cryptocurrency industry.
The feature would have information and insights not only from the cryptocurrency exchanges but also from the cryptocurrency assets.
Most importantly, the users will have information about cryptocurrencies and exchanges from a financial point of view.
The new feature is term as the proof of reserve (PoR), which would conduct audits of cryptocurrency exchanges that are active. It would continue tracking its financial data and reserves.
This would require the cryptocurrency exchanges to be as transparent as possible to clear out any confusion for their users.
The users would also know exactly which exchange is being honest with them, and which exchanges are not. The users would also be able to decide which exchange they would want to become part of.
The exchanges would also remain cautious and would strive to ensure none of their funds are being misused. This way, the exchanges will be clearing out the users’ concerns about liquidity.
The tracker would also display the publicly affiliated addresses that are linked with the exchanges. It would show the values, current prices, and balances held by the respective wallets.
The data on the proof of reserve feature will be updated every 5-minutes. The platform has already posted instructions on how the users would be able to interact and use the feature.
Significance of the New Tool
Given the current situation of the crypto market, it is a major step taken by CoinMarketCap. It will provide a huge amount of clarity to cryptocurrency users as they navigate the crypto industry.
Major cryptocurrency exchanges such as Binance and Huobi have already announced the adoption of the proof of reserve feature.
With this approach, the cryptocurrency industry would be able to avoid incidents such as the FTX exchange. If the analysts had access to the exchange’s reserves, they could have alerted the entire crypto industry.
However, the cryptocurrency industry is learning from its mistakes and the improvements such as the PoR would make the crypto industry a safe platform for users.