merkle verification root node

GCX Auditability

GCX aims to be the most transparent, fully allocated Gold exchange and Gold-backed payment platform in the world.

We aim to acheive this goal by also safeguarding our clients privacy.

Using the ‘proof of liabilities’ scheme which was initially successfully used in the world of virtual currency exchanges to prove that all assets were fully accounted for, we aim to give our users mathematical and irrefutable proof that their assets are safely and securely accounted for and fully backed by allocated bullion in storage with our vaulting partner, Brinks.

GCX operates a 100% full reserve exchange and your bullion is always allocated to you in your own name.

If you have any questions our development team are always at hand to help

Proof of Reserves

What are reserves?

Reserves in the context of GCX is the amount of Gold bullion that our clients have in storage with us. If a business holds reserves on behalf of its clients and its reserve ratio is 100% it is holding 100% of its client assets in storage.

Banks typically engage in a practice called fractional reserve lending which means that for every 10 units deposited, 9 units are leant out in the form of loans and 1 unit is kept in the vault to satisfy withdrawal requests.

This is the reason why, in the case of a bank run, banks are not able to 'make good’ on all client withdraw requests.

GCX operates a 100% full reserve as can be proven mathematically.

Why does GCX need to prove its reserves?

GCX’s Gold is stored with its vaulting partner Brinks. The records of how much Gold each of our clients holds is stored within our database with Brinks keeping record of the bars, their manufacturers and serial numbers.

Having the ownership records in a database has many benefits (instant settlement being the major one) however one major downside is that its difficult for a client to prove that the Gold reported from the database is actually in the vault and that GCX has not stolen the Gold like we hear so many horror stories in the press[1]

To protect yourselves against this risk, the total amount of Gold owned by our clients as reported by our database should exactly equal the amount of Gold that Brinks reports is in the vault and that’s what the mathematical proof of reserves demonstrates when paired against the official vault report from Brinks.

[1] Bullion Direct Vault Virtually Empty

Method of Proof

The easiest method of proof is to publish a flat list of all user accounts along with their Gold balances. However, this exposes a great deal of company information. The Merkle Tree technique makes it difficult for a company to falsify data whilst at the same time, protecting the privacy of our users.

How we implement Proof of Reserves

Our implementation is based on a method using Merkle Trees as proposed by Bitcoin developer Greg Maxwell, and as detailed here, with a few modifications to make it applicable to Gold. Using this method, a company can conclusively prove to a user that his/her account balance was taken into account in calculating the total amount of Gold bullion held and that the total bullion held in the database matches that reported by the vault custodian.


This method exposes some of GCX private information such as how much Gold we have under management. From this, competitors can infer how many users we have.

We believe this is a very small price to pay in order to satisfy our users that we operate in a very transparent manner and give them the assurance that GCX is a serious organisation to do business with.

We are therefore taking a long term view that this push towards transparency will win hearts and minds and help GCX differentiate itself from other less transparent bullion dealers.

Process to verify your assets

Every week on Sunday 12:00AM GMT GCX will publish a new root hash and will update all client verification trees for that week.

GCX will also publish the most recent Brinks statement.

Clients will be free to verify that their Gold balance has been taken into consideration when calculating the total and that the total equals what the vault custodian has in storage.

To verify your account balance:

Download Olivier Lalonde’s proof of liabilities tool:

Proof of Reserves Tool

From the GCX portfolio page download your partial tree .json file.

Save the GCX root merkle node obtained from this week’s audit report below in a file called root.json and in the same folder you saved your partial merkle tree.

Run the lproof tool using both this weeks root node and your partial verification tree.

The lproof tool has cryptographically verified that your account balance was taken into account when calculating the overall merkle tree.

Weekly audit reports

Sunday 11th of July 2016

The root verification node can be found on the pane on the right hand side.

The total XAU under management is 1262.206g.


The most recent Brinks statements can be found below.