Independent Research Confirms GBTC’s 633K Bitcoin: So Why Shouldn’t Grayscale?


Digital asset management firm Grayscale has refused to provide evidence of stores for its Grayscale Bitcoin Trust (GBTC), after an independent analyst spent days independently verifying its holdings via blockchain.

OXT Research analyst Ergo used on-chain forensics to confirm that GBTC holds approximately 633,000 bitcoin (BTC) with its custodian, Coinbase Custody, as of Nov. 23.

Since the collapse of FTX, other exchanges and digital asset managers have come under increased pressure to prove they owned the funds they claimed. The collapse of GBTC, or the liquidation of its holdings, would be a serious Black Swan event. Grayscale’s relationship with troubled cryptocurrency lender Genesis Global Trading has raised concerns as both venture capital firms are subsidiaries of Digital Currency Group.

The independent verification of its positions will give investors a degree of confidence in the product and the industry as a whole, and follows Coinbase’s verification of the positions earlier this week.

Ergo announced on November 20 that it was investigating GBTC holdings Tweet After Grayscale cited security vulnerabilities as the reason for discontinuing on-chain proof of store on November 18.

Ergo noted that most of the assets have recently moved from Grayscale’s previous security provider, Xapo, to Coinbase Custody. Ergo used public data and on-chain forensics to reveal balances of approximately 317,705 BTC at 432 addresses for potential GBTC custody activity. could use.

Also read  DocuSign Stock Spikes as Profit Estimates

related: Bitcoin Price Still Drops $12,000, Trader Says ETF Guru Supports GBTC

To find the rest of GBTC’s BTC, Ergo had to “scan the blockchain” to find additional addresses that matched the profile of the addresses originally found, noting that the analysis “certainly found false positives and negatives,” they found. addresses holding BTC almost identical to those claimed to hold GBTC.

Announcing that they had confirmed the holding, Ergo said:

“Which begs the question, why is Grayscale refusing to disclose its on-chain holdings?”

After searching GBTC’s January 2017 Securities and Exchange Commission (SEC) filings, Twitter user skyquake-1 offered a possible answer, stating that the custodian “cannot make such disclosures.” [public] Keys of the sponsor, trust or other person or entity.

Ergo has received praise from many in the community, including Ceteris of crypto research firm Delphi Digital, who retweeted the analysis and couple,

“Ergo is a treasure”

The Twitter community has been a constant source of insight into the crypto industry, especially since the collapse of FTX, and has also received praise for its efforts from Coinbase CEO and co-founder Brian Armstrong and Elon Musk.




Leave a Comment