Independent researcher confirms the presence of 633 000 BTC at Grayscale

The expert made this conclusion based on the analysis of blockchain data

25.11.2022 - 13:15

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2 min

What’s new? GBTC, the bitcoin trust of Grayscale Investments, a digital asset management company, owns 633 000 BTC (about $10,48 billion as of November 25, 12:30 UTC) in the wallets of the Coinbase crypto exchange’s custodial service. This information was published by an independent researcher under the pseudonym Ergo from The OXT Research.

Screenshot of the tweet

What other information is known? In his research, Ergo scanned the blockchain data and found 317 705 BTC belonging to the bitcoin trust and stored at Coinbase Custody. He then found additional addresses that likely belonged to Grayscale Investments. In his tweet, Ergo wondered what had prevented the company from disclosing its digital assets earlier.

Grayscale Investments refused to provide proof of reserves or wallet addresses while saying that all assets are held at Coinbase Custody. Grayscale added that the “panic sparked by others is not a good enough reason to circumvent complex security arrangements that have kept our investors’ assets safe for years.”

Coinbase Custody later released data on Grayscale reserves. The share of bitcoins in the Grayscale Bitcoin Trust was 635 235 coins, broadly in line with Ergo’s findings.

On November 22, Coinbase CEO Brian Armstrong also released information about user assets stored on the platform. This came after a tweet from Binance CEO Changpeng Zhao, in which he hinted at the insufficient amount of reserves of the exchange, pointing to conflicting information in the media regarding the number of bitcoins in GBTC. Shortly after Armstrong’s publication, Zhao deleted the tweet and called for cooperation to improve industry transparency.

Interest in the state of Grayscale’s reserves appeared in the crypto community due to the liquidity issues of crypto broker Genesis. Both companies are part of the Digital Currency Group (DCG).

For more details on how the bankruptcy of Genesis threatens the market, see GetBlock Magazine’s article.

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