Virgo Proof of Reserves and Security Report

Introduction:

VirgoCX is a Canadian-based trading platform that specializes in providing security and compliance for cryptocurrency transactions. Since its establishment in 2018, the company has prioritized the secure storage and custody of digital assets for its clients. To prove that it possessed sufficient cryptocurrencies to cover all customer liabilities, VirgoCX commissioned a “Proof of Reserve” (PoR) audit from Huayan CPA Professional Corporation on November 24th, 2020, at 14:35 EST. The audit examined all areas of the company’s operations, including Ledger Vault, security measures, and asset-liability ratio, to demonstrate VirgoCX’s commitment to transparency and compliance.

Summary of the Report:

The audit report confirmed that all customer cryptocurrency, including ETH, BTC, USDT, PAX, USDC, EURS, LTC, BCH, EOS, and PAXG, held by VirgoCX on Ledger Vault was verified using account balances and multi-signature wallet interface. Independent verification was conducted through access tests, balance change tests, and sample transaction data from the Bitcoin and Ethereum blockchains, providing full Proof of Reserves of the company’s cryptocurrency customer assets.

The security protocols required to access cryptocurrency customer assets make it highly unlikely that holdings in hot wallets will be compromised, while holdings in Ledger Vault’s institutional cryptocurrency storage solution are considered to be extremely unlikely to be compromised in any way.

In addition, all fiat customer balances in CAD and USD were confirmed by cross-referencing records in back-end systems with historical transaction and data records. As of the report’s date, all customer balances, according to VirgoCX’s records, matched the CAD and USD assets held in segregated bank accounts.

Findings from the Report:

During the assessment, Huayan CPA verified and tested the back-end system balances and confirmed that VirgoCX’s holdings, which included ETH, BTC, USDT, PAX, USDC, EURS, LTC, BCH, EOS, and PAXG cryptocurrencies, as well as CAD and USD fiat currencies, were more than 100% of its liabilities. The audit team also demonstrated ownership and control of these assets at the time of the assessment by using private keys. The audit revealed that VirgoCX held currency reserves in excess of customer liabilities to cover future transaction costs, with a collateralization ratio of 100% to 107%.

As of the publication of the report, all VirgoCX employees, including the founders and leadership team, had undergone criminal background checks. While there was no evidence of any employee compromising the company’s operations, effective tiered access and approval measures had been implemented to prevent or mitigate any breach of VirgoCX’s systems, customer data, and customer assets.