{"id":14791,"date":"2022-11-24T20:49:56","date_gmt":"2022-11-24T20:49:56","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/onchain-analysis-verifies-the-number-of-btc-held-by-grayscales-bitcoin-trust-bitcoin-news\/"},"modified":"2022-11-24T20:49:56","modified_gmt":"2022-11-24T20:49:56","slug":"onchain-analysis-verifies-the-number-of-btc-held-by-grayscales-bitcoin-trust-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/onchain-analysis-verifies-the-number-of-btc-held-by-grayscales-bitcoin-trust-bitcoin-news\/","title":{"rendered":"Onchain Analysis Verifies the Number of BTC Held by Grayscale\u2019s Bitcoin Trust \u2013 Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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After Grayscale Investments shared information concerning the company\u2019s product holdings, people questioned why the firm wouldn\u2019t 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).<\/strong><\/p>\n

OXT Researcher Verifies Grayscale\u2019s Bitcoin Holdings<\/h2>\n

Five days ago, Bitcoin.com News reported<\/a> on Grayscale disclosing information tied to the safety and security of the company\u2019s digital assets. Grayscale\u2019s statements were meant to assure the public that the company\u2019s cryptocurrencies are \u201csafe and secure\u201d after the FTX collapse.<\/p>\n

The digital asset fund manager detailed that all of the company\u2019s 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 \u201ccold storage.\u201d<\/p>\n

The one thing Grayscale did not disclose is the company\u2019s 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 \u201cdue to security concerns.\u201d The claim was criticized and mocked<\/a>, but Grayscale said that it understood the non-disclosure would be \u201ca disappointment to some.\u201d<\/p>\n

Despite Grayscale\u2019s non-disclosure, the OXT researcher (oxt.me<\/a>) Ergo<\/a> explained that it started a community-led effort to create transparency around GBTC holdings. \u201cWe have taken steps to ID likely GBTC addresses and balances based on public info and blockchain forensics,\u201d Ergo said<\/a> on Nov. 20.<\/p>\n

\"Onchain
Ergo said the team of researchers \u201cscanned the blockchain,\u201d leveraged heuristics, and connected publicly known bitcoin addresses.<\/figcaption><\/figure>\n

Leveraging an article from Coindesk, heuristics, and publicly known bitcoin addresses associated with the custodian Xapo, that day, Ergo \u201cattributed 432 addresses holding 317,705 BTC<\/a> to likely GBTC custody activity.\u201d<\/p>\n

The researcher discovered at least 50% of the GBTC holdings and added<\/a>: \u201cadditional work is necessary to ID the remaining addresses.\u201d By 2:49 p.m. (ET) on Nov. 23, Ergo said the additional work was finished in a Twitter thread called: \u201cThe Grayscale G(BTC<\/a>) Coins Part 2\u201d Ergo tweeted<\/a>:<\/p>\n

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In this analysis, we use additional [onchain] forensics to CONFIRM the approximate 633K BTC<\/a> balance held by G(BTC<\/a>) at Coinbase Custody.<\/p>\n<\/blockquote>\n

Ergo\u2019s summary notes that after discovering the first 50% of bitcoins associated with Grayscale\u2019s BTC<\/a>, the team had to \u2018scan the blockchain\u2019 for additional addresses fitting the profile of those found in Part 1.<\/p>\n

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Ergo further leaves independent analysts with information on the heuristics used<\/a> and the bitcoin addresses<\/a> compiled for the search. \u201cObviously no heuristic or set of heuristics are perfect, and this analysis certainly includes false positives and negatives,\u201d Ergo remarked<\/a>. \u201cBut our result is almost identical to the G(BTC<\/a>) self-reported holdings.\u201d<\/p>\n

In the Twitter thread, Ergo says that it doesn\u2019t know why Grayscale decided not to share the company\u2019s BTC<\/a> 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<\/a> \u201cit seems clear that Coinbase Custody is willing to disclose addresses.\u201d<\/p>\n

A number<\/a> of people complimented<\/a> Ergo\u2019s 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.<\/p>\n

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\nTags in this story
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633K bitcoin<\/a>, 633K BTC<\/a>, addresses<\/a>, Bitcoin (BTC)<\/a>, BTC<\/a>, BTC addresses<\/a>, BTC Cache<\/a>, BTC Stash<\/a>, BTC wallets<\/a>, custodian<\/a>, Digital Assets<\/a>, Ergo<\/a>, Ergo BTC<\/a>, false positives and negatives<\/a>, fund manager<\/a>, GBTC<\/a>, GBTC holdings<\/a>, grayscale<\/a>, Grayscale Investments<\/a>, heuristics<\/a>, Onchain analysis<\/a>, Onchain Research<\/a>, OXT<\/a>, OXT researcher<\/a>, oxt.me<\/a>, oxt.me data<\/a>, publicly known bitcoin addresses<\/a>, Xapo<\/a><\/div>\n<\/div>\n

What do you think about Ergo\u2019s onchain analysis of GBTC\u2019s bitcoin horde? Let us know what you think about this subject in the comments section below. <\/strong> <\/em><\/p>\n

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\nJamie Redman <\/h6>\n

\nJamie 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.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons, Ergo BTC, Grayscale logo, <\/em><\/p>\n

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Disclaimer<\/strong>: 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<\/a> 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.<\/p>\n<\/div>\n

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