Definition ∞ Crypto exchange capital refers to the total financial resources, including digital assets and fiat currency reserves, held and managed by a cryptocurrency exchange. This capital base supports the exchange’s operations, liquidity provisions, and user asset security. It also reflects the exchange’s capacity to absorb market volatility and meet withdrawal demands. The amount and composition of this capital are key indicators of an exchange’s financial health.
Context ∞ Discussions around crypto exchange capital often center on transparency requirements and regulatory oversight following market instability events. A significant concern involves ensuring exchanges maintain sufficient reserves to cover all user deposits, a concept known as proof-of-reserves. Regulators are increasingly scrutinizing the adequacy and verifiable nature of capital held by these platforms to protect consumers and maintain market integrity.
Blockchain Knowledge
Cryptocurrency Foundation
Cryptospace Newsfeed
