Crypto Finance, part of Deutsche Börse Group, went live with Chainlink Proof of Reserve. As the first user, nxtAssets is now enabling on-chain verification of assets held in custody by Crypto Finance for its physically backed Ethereum and Bitcoin Exchange Traded Products (ETPs). Proof of Reserve allows investors to independently verify the actual holdings behind an ETP. This innovation provides investors with an additional layer of transparency and security, setting new standards for trust in the digital asset market.
The setup brings together three essential roles: nxtAssets issuing and managing the ETPs, Crypto Finance providing regulated custody of the underlying assets, and Chainlink delivering tamper-resistant reserve data on-chain.
Through Chainlink’s decentralized oracle technology, nxtAssets will be able to provide verifiable Bitcoin (BTC) and Ethereum (ETH) reserve data. This reserve data is orchestrated by the Chainlink Runtime Environment (CRE), published on Arbitrum, and publicly viewable. The custodial assets are cryptographically verified without disclosing sensitive wallet addresses or private data.
While the administrator continues to publish the official End-of-Day Net Asset Value (NAV) based on Assets Under Management (AUM), proof of reserves will enable independent verification that the underlying assets are fully collateralized – without disclosing sensitive wallet addresses or compromising operational security.
“Proof of Reserves marks a major step in institutionalizing trust and transparency for digital assets. With Chainlink’s technology, we can provide investors with verifiable information on reserves while maintaining the highest standards of security and operational integrity”
said Stijn Vander Straeten, CEO of Crypto Finance.
Dirk Hess, Managing Director of nxtAssets
“This initiative sets nxtAssets apart from other ETP providers. By adopting Chainlink Proof of Reserves, we are enhancing transparency for end investors and providing greater visibility to regulators, auditors, and the broader market. Transparency is the key to growing digital asset investments responsibly”
added Dirk Hess, Managing Director of nxtAssets.
„Transparency in digital asset markets requires more than periodic reporting, it requires continuously verifiable data. By integrating Chainlink Proof of Reserve, Crypto Finance is demonstrating how regulated custodians can provide investors with assurances that every product is asset-backed. This live application establishes a new benchmark for trust and accountability in the global ETP market starting with two of nxtAsset’s ETPs with more to come.“
said Fernando Vazquez, President of Banking and Capital Markets, Chainlink Labs.
The integration of Chainlink’s Proof of Reserves provides multiple benefits: greater transparency compared to traditional reporting cycles, enhanced security through aggregated and anonymized reserve verification, and historical data access at any point in time. For Crypto Finance and nxtAssets, it also streamlines reporting, increases credibility with institutional investors, and demonstrates a clear commitment to regulatory alignment and investor protection.
