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From Transparency to Trust: Why Proof of Reserve Is the Only Shield Against β€œPaper Bitcoin” Bitcoin was created to eliminate counterparty risk through direct ownership and verifiable scarcity. Yet without public proof of reserves from exchanges, corporate treasuries, and public companies, the risk of paper BTCβ€”digital claims without the underlying assetβ€”remains high. The Proof of Reserve verification tool enables entities to cryptographically prove their holdings by signing statements with their private keys, ensuring reserves are real, on-chain, and verifiable by anyone.