21Shares Enhances Ethereum Reserve Transparency with Chainlink Proof of Reserve Integration

21Shares, a part of 21Shares AG, has recently unveiled the incorporation of Chainlink Proof of Reserve on the Ethereum mainnet to enhance transparency regarding the Ethereum reserves supporting the 21Shares Core Ethereum ETF (CETH). This ETF is backed by Ether and mirrors its performance.

The financial institution based in Zurich highlighted that this development is in line with its broader objectives to diversify its US product portfolio and fortify its foothold in the US market.

The decision to opt for Chainlink as the decentralized computing platform was based on its established track record in facilitating over $12 trillion in value for on-chain markets. By integrating Chainlink’s Proof of Reserve (PoR), 21Shares emphasized that it guarantees clear visibility into the Ether reserves underpinning CETH. This move aims to boost investor confidence and transparency, as mentioned in the official press release.

The integration brings forth several advantages, including automated on-chain verification enabling investors to devise automated logic based on CETH’s collateralization. Furthermore, the PoR eliminates centralized points of failure in transmitting external data to blockchains, ensuring consistent and reliable on-chain updates for CETH’s collateralization. It also offers near real-time transparency, empowering investors to independently verify asset collateralization.

Johann Eid, Chief Business Officer of Chainlink Labs, expressed enthusiasm about the collaboration with 21Shares, emphasizing the significance of enhancing transparency in the 21Shares Core Ethereum ETF through Chainlink Proof of Reserve. He acknowledged 21Shares’ pivotal role in promoting digital asset adoption and highlighted how the Chainlink platform facilitates seamless tokenization on a global scale.

This announcement follows the recent launch of spot Ether ETFs for trading in the US, reflecting the escalating global momentum and acceptance of cryptocurrencies. Ophelia Snyder, Co-Founder and President of 21Shares, noted that the transparency of their spot Bitcoin ETP was significantly enhanced by Chainlink PoR, making the decision to leverage Chainlink’s reserves verification service for the spot Ethereum ETP, CETH, an obvious choice.

The integration of Chainlink Proof of Reserve for the spot Bitcoin ETF comes several months after 21Shares integrated it in February 2024 to bolster the transparency of the Bitcoin reserves supporting the ARK 21Shares Bitcoin ETF. Launched in January 2024, the ARK 21Shares Bitcoin ETF (ARKB) is a prominent spot Bitcoin ETP currently managing $3.2 billion in assets.

In conclusion, the collaboration between 21Shares and Chainlink through the integration of Proof of Reserve underscores a commitment to transparency and reliability in the crypto asset market, catering to the growing demand for secure and transparent investment options.