Fun

Onchain Analysis Verifies the Number of BTC Held by Grayscale’s Bitcoin Trust

News Feed - 2022-11-25 04:11:52

Onchain Analysis Verifies the Number of BTC Held by Grayscale’s Bitcoin Trust


After Grayscale Investments shared information concerning the company’s product holdings, people questioned why the firm wouldn’t share the public addresses associated with the crypto assets it holds. However, on Nov. 23, OXT researcher Ergo published a Twitter thread featuring onchain forensics that confirm Coinbase Custody holds a balance of 633K bitcoin that likely belongs to the Grayscale Bitcoin Trust (GBTC). OXT Researcher Verifies Grayscale’s Bitcoin Holdings


Five days ago, Bitcoin.com News reported on Grayscale disclosing information tied to the safety and security of the company’s digital assets. Grayscale’s statements were meant to assure the public that the company’s cryptocurrencies are “safe and secure” after the FTX collapse.


The digital asset fund manager detailed that all of the company’s digital assets are stored with Coinbase Custody Trust Company. On the Grayscale website, the firm says Coinbase Custody is a qualified custodian under New York banking laws and the funds are kept in “cold storage.”


The one thing Grayscale did not disclose is the company’s digital asset addresses and it did mention why it chose not to share the wallets. Grayscale explained that it has never publicly disclosed onchain addresses to the general public “due to security concerns.” The claim was criticized and mocked, but Grayscale said that it understood the non-disclosure would be “a disappointment to some.”


Despite Grayscale’s non-disclosure, the OXT researcher (oxt.me) Ergo explained that it started a community-led effort to create transparency around GBTC holdings. “We have taken steps to ID likely GBTC addresses and balances based on public info and blockchain forensics,” Ergo said on Nov. 20. Ergo said the team of researchers “scanned the blockchain,” leveraged heuristics, and connected publicly known bitcoin addresses.


Leveraging an article from Coindesk, heuristics, and publicly known bitcoin addresses associated with the custodian Xapo, that day, Ergo “attributed 432 addresses holding 317,705 BTC to likely GBTC custody activity.”


The researcher discovered at least 50% of the GBTC holdings and added: “additional work is necessary to ID the remaining addresses.” By 2:49 p.m. (ET) on Nov. 23, Ergo said the additional work was finished in a Twitter thread called: “The Grayscale G(BTC) Coins Part 2” Ergo tweeted: In this analysis, we use additional [onchain] forensics to CONFIRM the approximate 633K BTC balance held by G(BTC) at Coinbase Custody.


Ergo’s summary notes that after discovering the first 50% of bitcoins associated with Grayscale’s BTC, the team had to ‘scan the blockchain’ for additional addresses fitting the profile of those found in Part 1.



Ergo further leaves independent analysts with information on the heuristics used and the bitcoin addresses compiled for the search. “Obviously no heuristic or set of heuristics are perfect, and this analysis certainly includes false positives and negatives,” Ergo remarked. “But our result is almost identical to the G(BTC) self-reported holdings.”


In the Twitter thread, Ergo says that it doesn’t know why Grayscale decided not to share the company’s BTC addresses. Ergo said the team originally thought Coinbase Custody may have a non-disclosure policy. But after reading some information published by Coinbase, Ergo said “it seems clear that Coinbase Custody is willing to disclose addresses.”


A number of people complimented Ergo’s Twitter thread and analysis of the GBTC coins. Furthermore, the news follows Coinbase CEO Brian Armstrong explaining that as of Sept. 30, Coinbase holds 2 million bitcoin. Tags in this story 633K bitcoin, 633K BTC, addresses, Bitcoin (BTC), BTC, BTC addresses, BTC Cache, BTC Stash, BTC wallets, custodian, Digital Assets, Ergo, Ergo BTC, false positives and negatives, fund manager, GBTC, GBTC holdings, grayscale, Grayscale Investments, heuristics, Onchain analysis, Onchain Research, OXT, OXT researcher, oxt.me, oxt.me data, publicly known bitcoin addresses, Xapo


What do you think about Ergo’s onchain analysis of GBTC’s bitcoin horde? Let us know what you think about this subject in the comments section below. Jamie Redman


Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today. Hollywood, Streaming Giants Scramble for Movie Rights to FTX Saga NEWS | 2 hours ago New York Times Gets Mocked for Allowing Sam Bankman-Fried to Speak at Dealbook Summit NEWS | 6 hours ago


Image Credits: Shutterstock, Pixabay, Wiki Commons, Ergo BTC, Grayscale logo, Previous articleNew York Times Gets Mocked for Allowing Sam Bankman-Fried to Speak at Dealbook Summit Next articleHollywood, Streaming Giants Scramble for Movie Rights to FTX Saga Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItRipple CEO: SEC Lawsuit Over XRP "Has Gone Exceedingly Well"


The CEO of Ripple Labs says that the lawsuit brought by the U.S. Securities and Exchange Commission (SEC) against him and his company over XRP "has gone exceedingly well." He stressed: "This case is important, not just for Ripple, it’s ... read more.Oman to Incorporate Real Estate Tokenization in Virtual Assets Regulatory Framework Today"s Top Ethereum and Bitcoin Mining Devices Continue to Rake in Profits Privacy-Centric Monero Plans for July Hard Fork, Plans Include Ring Signature, Bulletproof Upgrade Survey: Adoption in Argentina Grows, With 12 out of 100 Adults Having Invested in Crypto

News Feed

Fidelity Investments Purchases 7.4% Stake in Bitcoin Mining Firm Marathon
Fidelity Investments Purchases 7.4% Stake in Bitcoin Mining Firm Marathon Marathon Digital Holdings has published the company’s bitcoin production and mini
Oscar Mayer Is Auctioning a 10-Pack of Dogecoin-Themed Hot Dogs, Proceeds Go to Hunger-Relief Charity
Oscar Mayer Is Auctioning a 10-Pack of Dogecoin-Themed Hot Dogs, Proceeds Go to Hunger-Relief Charity After a great number of well known product brands like Burg
NFT Creators Investigated in Israel for Alleged Tax Evasion
NFT Creators Investigated in Israel for Alleged Tax Evasion Israel’s tax authority is after two creators of non-fungible tokens (NFTs) suspected of failing to report almost
Bitcoin breaks ATH against a dozen currencies as BTC price breaches $59K
Prashant Jha12 hours agoBitcoin breaks ATH against a dozen currencies as BTC price breaches $59KThe new BTC ATH against several fiat currencies shows their declining market value due to rising inflation.7621 Total views1
Visa and Mastercard: A boon for wallet holders, a threat to crypto exchanges?
Andrew Singer8 hours agoVisa and Mastercard: A boon for wallet holders, a threat to crypto exchanges?Crypto debit cards aren’t new. But Visa supports 40 cryptocurrencies across an enormous network. “That’s a big de
Multibillion Dollar Fund Manager Ruffer Sees Long Trend of Institutional Bitcoin Adoption
Multibillion Dollar Fund Manager Ruffer Sees Long Trend of Institutional Bitcoin Adoption British investment management firm Ruffer has revealed that its bitcoin
DeFi fund, Texas apparel company sue to defend airdrop against SEC
Derek Andersen3 hours agoDeFi fund, Texas apparel company sue to defend airdrop against SECThe tokens are distributed for free and unasked for, so they’re not securities, according to the suit.3759 Total viewsListen to
Turner Wright6 hours agoUS DoJ is concerned about a run on Binance should prosecutors bring fraud charges: ReportOfficials reportedly speculated an indictment against Binance in the U.S. could cause a run on the exchange
Bitcoin, Ethereum Technical Analysis: BTC, ETH Hit 2-Week Lows, Ahead of US Midterms 
Bitcoin, Ethereum Technical Analysis: BTC, ETH Hit 2-Week Lows, Ahead of US Midterms  Bitcoin fell below $20,000 on Tuesday, as markets prepared for the U.S. midterm elections. Cr
Circle becomes first licensed stablecoin issuer under MiCA
Vince Quill7 hours agoCircle becomes first licensed stablecoin issuer under MiCACircle’s USDC and EURC stablecoins become the first fully compliant digital fiat tokens under the Markets in Crypto-Assets rules.5557 Tota
Nigerian Crypto Payment Gateway Fluidcoins Acquired by Seychelles-Based Crypto Exchange
Nigerian Crypto Payment Gateway Fluidcoins Acquired by Seychelles-Based Crypto Exchange The Nigerian crypto payment gateway Fluidcoins was recently bought for an undisclosed sum by
45 Older-Generation Bitcoin Miners Are Unprofitable After the Reward Halving
45 Older-Generation Bitcoin Miners Are Unprofitable After the Reward HalvingOn May 11, the Bitcoin network experienced its third block reward halving, which had chopped the 12.5 BTC