The Texas Senate has passed House Bill 1666, which deals with ensuring verification of the declared reserves by crypto exchanges. It will become law in Texas as soon as the governor signs it.

Proof of Reserve (PoR)

Cryptocurrency exchanges often claim to have a 1:1 ratio of reserves, and in order to prove this, they keep presenting some proof of reserve. However, such PoR are optional, and not always accurate. House Bill 1666 require exchanges to submit proof of their reserves, ie exchanges will have to provide accurate information.

Monitoring The Fraud

Those who are superstitious about exchanges do not find this the right step. But it will be needed because, after the collapse of the FTX empire, many crypto platforms went bankrupt and all exchanges were losing confidence among investors. Then some exchanges like Kraken, Binance, and Coinbase tried to win public trust.

Privacy of Investor, Never mind

The target of every law enacted in the name of eliminating fraud, is the privacy of cryptocurrency investors, and this bill is no exception. Bill 1666 applies only to exchanges in which more than 500 citizens of Texas invest at least $10 million. Hence, this bill also monitor the crypto investors of the state and the money invested by them.