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Poloniex’s $1.3B BTC Reserve Shortfall Exposed

Poloniex offers fee-free trading amid scrutiny over its Bitcoin reserves and collateral.

  • Poloniex announced fee-free trading for members of its “Poloniex Super” program, but did not specify the cost after a 30-day trial.
  • Owner Justin Sun claimed the exchange can operate without fees due to profits from Bitcoin purchased in 2012.
  • Protos analysis suggests a possible Bitcoin shortfall, as the exchange’s tokenized BTC product appears under-collateralized against its disclosed reserves.

The crypto exchange Poloniex, owned by Justin Sun, announced fee-free trading for users who enroll in its new membership program. However, the exchange has not revealed what the membership will cost after the initial 30-day trial period ends.

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Sun explained the move by stating, “We already made enough from the bitcoin (BTC) we bought in 2012.” Consequently, this statement highlights scrutiny over how the exchange manages its Bitcoin reserves.

Poloniex offers a tokenized Bitcoin product on the Tron blockchain with a circulating supply worth approximately $1.3 billion. Meanwhile, the exchange’s own proof of reserves claims it holds only 11,090 BTC in total, a figure insufficient to fully collateralize the token.

Furthermore, another Sun-associated exchange, HTX, holds a significant portion of this tokenized BTC in its reserves. Data shows that as of March 1, the token accounted for nearly half of HTX’s total Bitcoin holdings. Protos has repeatedly asked Poloniex to disclose the Bitcoin addresses backing this product but received no information before publication.

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