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On-Chain Analysis Confirms Amount Of BTC Owned By Bitcoin Trust Grayscale – Bitcoin News

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

After Grayscale Investments shared information about the company’s product holdings, people wondered why the firm did not disclose public addresses associated with the crypto assets it owns. However, on Nov. 23, OXT researcher Ergo tweeted a forensic thread that confirms that Coinbase Custody holds a balance of 633k bitcoins, which is likely owned by the Grayscale Bitcoin Trust (GBTC).

OXT Researcher Verifies Grayscale Bitcoin Assets

Five days ago, Bitcoin.com News reported that Grayscale was disclosing information related to the security of the company’s digital assets. Grayscale’s statements were intended to reassure the public that the company’s cryptocurrencies are “safe and sound” in the wake of the FTX crash.

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

The only thing that Grayscale did not disclose was the addresses of the company’s digital assets, and it mentioned why it decided not to share wallets. Grayscale explained that it never publicly disclosed the network’s addresses to the general public “for security reasons.” The statement was criticized and ridiculedbut Grayscale said it understood non-disclosure would be “a disappointment to some”.

Although Grayscale does not disclose information, the OXT researcher (oxt.me) Consequently explained that he started a community effort to bring transparency to GBTC assets. “We have taken steps to identify probable GBTC addresses and balances based on public information and blockchain forensics,” Ergo. said 20 November.

On-Chain Analysis Confirms Amount of BTC Owned by Bitcoin Trust Grayscale
Ergo said the research team “scanned the blockchain”, used heuristics and plugged in well-known bitcoin addresses.

Using a Coindesk article, heuristics, and commonly known bitcoin addresses associated with custodian Xapo, on that day, Ergo “attributed 432 addresses containing 317,705 BTC to GBTC’s likely custody activity.”

Researcher discovered at least 50% of GBTC assets and added: “more work is needed to identify the remaining addresses.” By 2:49 pm ET on Nov. 23, Ergo revealed that additional work had been completed on a Twitter thread titled “G(BTC) Greyscale Coins Part 2.” Ergo tweeted:

In this analysis, we use additional [onchain] forensic examination to CONFIRM the approximate balance of 633,000 BTC held by G (BTC) in 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 matching the profile of those found in Part 1.

On-Chain Analysis Confirms Amount of BTC Owned by Bitcoin Trust Grayscale

Ergo further leaves information to independent analysts about used heuristic and bitcoin addresses compiled for search. “Obviously no single heuristic or set of heuristics is perfect, and this analysis certainly includes false positives and negatives,” Ergo noticed. “But our result is nearly identical to the G (BTC) holdings reported by users themselves.”

In a Twitter thread, Ergo says he doesn’t know why Grayscale chose not to share the company’s BTC addresses. Ergo said the team initially thought Coinbase Custody might have a non-disclosure policy. But after reading some information published by Coinbase, Ergo said “It seems clear that Coinbase Custody wants to disclose addresses.”

BUT amount of people compliment Ergo Twitter thread and GBTC coin analysis. Additionally, the news follows Coinbase CEO Brian Armstrong explaining that as of September 30, Coinbase owns 2 million bitcoins.

Tags in this story

633,000 bitcoins, 633,000 bitcoins, addresses, bitcoins (BTC), BTC, BTC addresses, BTC cache, BTC stash, BTC wallets, custodian, digital assets, Ergo, Ergo BTC, false positives and denials, fund manager, GBTC, holdings GBTC, Grayscale Investments, Heuristics, Onchain Analysis, Onchain Research, OXT, OXT Researcher, oxt.me, oxt.me Data, Bitcoin Public Addresses, Xapo

What do you think of Ergo’s online analysis of the GBTC bitcoin horde? Let us know what you think about it in the comments section below.

Jamie Redman

Jamie Redman is the head of news at Bitcoin.com News and a fintech journalist based in Florida. Redman has been an active member of the crypto community since 2011. He is passionate about bitcoin, open source and decentralized applications. Since September 2015, Redman has written over 6,000 articles for Bitcoin.com News about new revolutionary protocols.




Image credits: Shutterstock, Pixabay, Wiki Commons, Ergo BTC, grayscale logo,

Denial of responsibilityA: This article is for informational purposes only. It is not a direct offer or solicitation to buy or sell, nor is it 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 directly or indirectly liable for any damage or loss caused or alleged to be caused by the use of or reliance on any content, goods or services mentioned in this article.

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