Digital asset exchange Gate has launched Proof of Security (PoSEC), a new asset security verification framework that makes it the first digital asset trading platform in the industry to operate a PoSEC-based verification system. Founded in 2013, Gate has consistently placed user asset security among its top priorities, and the new framework extends security verification beyond reserve adequacy to cover asset storage structures and risk coverage capabilities. The company says the initiative provides a new practical approach to advancing security standards across the industry.

The announcement was published by Global FinTech Series.

PoSEC Focuses on Storage Security and Extreme-Risk Coverage

Unlike Proof of Reserves (PoR), which primarily verifies the adequacy of asset reserves, PoSEC places additional emphasis on asset storage security. The framework publicly discloses the distribution of assets between platform cold storage and hot wallets, giving users visibility into storage structures and their ability to cover potential losses under extreme scenarios.

At the core of PoSEC is the cold storage coverage ratio, a key metric that measures the extent to which cold storage covers total user assets. A coverage ratio of 100% or higher means that, under the applicable calculation methodology, cold storage alone would be sufficient to cover all user assets even if all assets held in hot wallets were lost. The distinction carries practical weight for exchange customers: hot wallets remain connected to the internet to handle routine deposits and withdrawals and are generally regarded as the more exposed layer of a platform's custody stack, while cold storage, kept offline, sits largely outside that attack surface. PoR and PoSEC are intended to serve complementary purposes, extending asset security verification from reserve adequacy to storage security and risk coverage while offering users more comprehensive and transparent information about asset security.

Cold Storage Coverage Reaches 104.58%

According to a snapshot taken at 00:00 (UTC) on November 4, 2026, Gate's cold storage coverage ratio reached 104.58%, with cold storage and hot wallet assets accounting for 88.26% and 11.74% of total assets, respectively.

Cold storage assets include digital assets held offline as well as traditional assets under independent custody. To qualify, these assets must meet requirements such as not being directly used for routine deposits and withdrawals, being held offline or under independent custody, requiring multi-party authorization for transfers, and being independently verifiable.

The current data is undergoing verification by an independent third-party audit firm. The review covers asset authenticity and control, valuation and calculation methodologies, and coverage ratio calculations. Until that review concludes, the published figures rest on the company's own snapshot and methodology, which makes the completed audit the immediate checkpoint for the disclosure. The audit report will be published on Gate's official website upon completion, a step the company says will enhance the transparency and credibility of its asset security disclosures.

From PoR to PoSEC

Gate has long emphasized digital asset security and transparency. In 2020, it was among the first in the industry to introduce an open-source Proof of Reserves mechanism and a Merkle Tree-based asset verification solution, establishing itself as an early contributor to reserve transparency. The company subsequently incorporated technologies such as zk-SNARKs to strengthen its asset reserve verification framework. Reserve disclosures of this kind have since become a familiar transparency practice across centralized exchanges, although such attestations typically address reserve adequacy rather than how and where customer assets are actually stored — the gap PoSEC is designed to address.

As of October 18, 2026, Gate's total reserves amounted to approximately $8.688 billion, with an overall reserve ratio of 118.49%. The platform also employs a range of security mechanisms, including hot and cold wallet segregation, multi-signature technology, Multi-Party Computation (MPC), dynamic risk monitoring, and zero-trust access control, to establish a multi-layered security framework covering asset reserves, storage management, and risk protection.

Outlook

With PoR verifying reserve adequacy and PoSEC verifying asset storage security and risk coverage capabilities, Gate says it is progressively building a security framework that encompasses asset reserves, storage management, risk protection, and public verification. The company stated that it will continue to uphold its security-first principle, further develop PoSEC standards and verification mechanisms, and collaborate with more industry participants to enhance asset security and transparency, laying a stronger security foundation for the long-term, sustainable development of the digital asset industry. The near-term markers are concrete: publication of the completed audit report on Gate's official website, and the company's stated plan to develop PoSEC standards jointly with other industry participants.