Chainlink Proof of Reserve Now Backs 21Shares Core Ethereum ETF

21Shares US LLC, an affiliate of 21Shares AG, has integrated Chainlink's Proof of Reserve on Ethereum mainnet to enhance the transparency of its Core Ethereum ETF (CETH). 

This move aims to provide clear visibility into the Ethereum reserves backing the ETF and bolster investor confidence, according to a press release shared with BSCN.

Enhanced Transparency with Chainlink

Chainlink Proof of Reserve offers real-time and historical data on reserves. As per reports, It allows anyone to verify the collateralization of CETH independently. This integration ensures that the ETF is transparently backed by Ether (ETH), the second-largest crypto asset by market capitalization.

"21Shares is playing an important role in supporting the adoption of digital assets, and the Chainlink platform is helping financial institutions realize the vision of seamless tokenization on a global scale," Johann Eid, Chief Business Officer of Chainlink Labs, said.

Worth noting, in February 2024, 21Shares announced the integration of Chainlink Proof of Reserve for the Bitcoin reserves backing the ARK 21Shares Bitcoin ETF. This ETF, launched in January 2024, currently has $3.2 billion in assets under management (AUM).

Key Features of Chainlink PoR

Automated Onchain Verification

One of the key benefits of Chainlink Proof of Reserve is automated onchain verification. This feature reportedly keeps up-to-date onchain data in a reference contract, allowing investors and protocols to build automated logic based on updates to CETH’s collateralization. 

This helps in maintaining the integrity of the assets and building trust among investors.

Decentralized Data Feeds

Chainlink Proof of Reserve eliminates central points of failure in delivering external data to blockchains. It ensures reliable onchain updates at all times regarding CETH’s collateralization. This decentralized approach enhances the security and reliability of the data.

Transparency and Security

The Proof of Reserve feeds can be monitored by anyone in near real-time, allowing investors to independently verify the asset collateralization. This transparency is crucial in maintaining investor confidence and trust.

Global Adoption of Chainlink’s Technology

Chainlink’s Proof of Reserve technology has been adopted by various financial institutions. For instance, Colombia’s largest bank, Bancolombia Group-backed Wenia, integrated Chainlink’s Proof of Reserve to enhance the transparency and security of its stablecoin, COPW.

The platform has also partnered with BNY Mellon, Citi, BNP Paribas, ANZ Bank, Lloyds Banking Group, and SIX Digital Exchange.