Don’t Trust, Verify: Chainlink Proof of Reserve Selected to Provide Transparency Into Wrapped.com Assets

All wrapped.com assets are backed 1:1 by a qualified custodian. Chainlink PoR confirms that this is fully-verifiable on-chain.

Wrapped.com is excited to announce that we’ve selected Chainlink Proof of Reserve (PoR) to provide complete on-chain auditability of supported wrapped assets, which are fully backed 1:1 by a qualified custodian. Chainlink PoR uses on-chain reference feeds to provide smart contracts with the data needed to calculate the true collateralization of wrapped.com assets.

With Chainlink PoR, our users can verify in real-time that their wrapped assets are fully collateralized. By integrating Chainlink PoR, wrapped.com brings increased transparency and auditability to wrapped assets to provide users with the information they need to make informed decisions.

Understanding Chainlink PoR

Chainlink PoR is a decentralized service offered by the industry-leading Chainlink Network. Using highly secure and reliable decentralized oracle networks (DONs), Chainlink PoR enables autonomous auditing of the collateral backing wrapped.com assets in real-time. Chainlink PoR helps ensure that user funds are protected, increasing user confidence that the wrapped.com team is not engaging in any suspect fractional reserve practices that have been observed with other assets in the space.

Not only does Chainlink PoR create insight around wrapped.com assets, but it also helps push the DeFi ecosystem towards a higher degree of transparency around asset collateralization in general. Chainlink PoR sets a new standard for auditability where users have proof that the assets they own and the protocols they use are fully backed and collateralized. This also enables smart contracts to natively determine a cross-chain token’s true collateralization, which we feel is of great importance to the overall stability of the blockchain space as it continues to scale and expand multi-chain.

Exploring How Chainlink PoR Works

Proof of Reserve feeds for wrapped.com assets are supported by a decentralized network of Chainlink oracles that use off-chain computation to check wallet balances every ten minutes. Whenever a deviation is detected beyond a predefined threshold from the previous balance stored on-chain, the on-chain Proof of Reserve reference feed is updated with the new balance data.

By making an asset’s reserve data available on-chain, smart contract-based DeFi applications using wrapped.com assets are able to employ customized logic to automatically protect user funds during an undercollateralization event. Having Chainlink PoR as an early-warning system is particularly beneficial for applications that use wrapped.com assets as collateral to secure the borrowing of other digital assets.

Chainlink Proof of Reserve reference feeds can be constructed to provide collateralization data on any wrapped.com asset, including cross-chain tokens settled on any smart contract-enabled blockchain (e.g. Wrapped Bitcoin on Polkadot, Wrapped ETH on Celo, etc).

Chainlink’s highly flexible and transparent oracle network model helps accelerate the growth of DeFi by providing collateralization data on a wide array of wrapped.com assets and enables new cross-chain diversification opportunities. Chainlink oracle services are also historically highly reliable, updating reference contracts even during periods of high network congestion and extreme market volatility.

Receiving On-Chain Auditability With Chainlink PoR

Chainlink Proof of Reserves provides both the growing DeFi ecosystem and the traditional financial system a way to boost transparency of operations with definitive on-chain proof of any asset’s true collateralization.

As the smart contract ecosystem grows, it is critical that trust is maintained end-to-end without gaps, ensuring market failures caused by opaque and toxic collateral lending become a part of history.

With Chainlink Proof of Reserve, wrapped.com assets will be well-positioned to scale up to secure a next generation of innovative financial products that are fully-backed 1:1.

“For far too long, much of the blockchain industry has resembled the traditional financial world where user assets are freely rehypothecated and used at the discretion of large, centralized entities. Chainlink PoR creates a whole new level of transparency for DeFi and CeFi institutions through its automated auditing system that can be verified by anyone in real-time.” — Mason Borda, CEO of Tokensoft More About Chainlink

Chainlink is the industry standard oracle network for powering hybrid smart contracts. Chainlink Decentralized Oracle Networks provide developers with the largest collection of high-quality data sources and secure off-chain computations to expand the capabilities of smart contracts on any blockchain. Managed by a global, decentralized community, Chainlink currently secures billions of dollars in value for smart contracts across decentralized finance (DeFi), insurance, gaming, and other major industries.

Chainlink is trusted by hundreds of organizations, from global enterprises to projects at the forefront of the blockchain economy, to deliver definitive truth via secure, reliable oracle networks. To learn more about Chainlink, visit chain.link.

More About Wrapped

Wrapped lets investors use their digital assets to lend, borrow, and trade on all major DeFi platforms. Each wrapped asset is fully-collateralized and held with a qualified custodian. Learn more by visiting https://wrapped.com.

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Don’t Trust, Verify: Chainlink Proof of Reserve Selected to Provide Transparency Into Wrapped.com