On November 18, 2022, at 5:47 PM ET, the official Twitter account of Grayscale Investments shared a security message related to Grayscale’s digital asset products. Grayscale’s update comes after the recent FTX debacle shook cryptocurrency investors, and Digital Currency Group’s (DCG) Genesis suspended the firm’s lending arm in terms of withdrawals and new loan originations.
Grayscale Updates Safety and Security Information to Public – Custody Says “All Digital Assets Forming the Basis of Grayscale’s Digital Asset Products Are Held by Coinbase Custody”
The aftermath of FTX caused a chain reaction of panic in the cryptocurrency industry, leading to massive cryptocurrency withdrawals after the incident. For example, over $5 billion worth of Bitcoin (bitcoin) and Ethereum (Ethereum) used to be revoke From exchanges between November 7th and November 14th, 2022. FTX crashes also come on right proof of reserves concept, as Binance, Huobi, password.com, and many other cryptocurrency trading platforms have shared wallet addresses over the past two weeks.Grayscale Investments on Friday tweets One renew The digital asset product of the company “Safety of Holding Assets”.
Grayscale’s announcement follows Genesis Corp. pause The company’s lending unit in terms of withdrawals and new loan originations. Like Genesis, Grayscale is a subsidiary of Digital Currency Group (DCG), and since the exit pause, much speculation has surrounded Genesis and its parent company, DCG. Wall Street Journal (WSJ) Report On November 17, 2022, the Wall Street Journal news desk reviewed a “confidential fundraising document” that revealed that Genesis was reportedly seeking a “$1 billion emergency loan” from investors.
there are many critical orientation At Grayscale and people talk How Grayscale Bitcoin Trust (OTCMKTS:GBTC) has been upside down lately. For example, GBTC’s premium or discount to NAV changed from a premium to a discount in March 2022 and has remained that way since then. As far as Ark Investment Management is concerned, DCG is the largest shareholder of GBTC.grayscale manage 643,572 Bitcoin (bitcoin), equivalent to 3.065% of the Bitcoin supply cap.
“Each of Grayscale’s digital asset products is set up as a separate legal entity: an investment trust for single asset products and a limited liability company for diversified products,” Grayscale shared In Friday’s update. “The laws, regulations, and documents that define Grayscale’s digital asset offerings prohibit lending, borrowing, or otherwise collateralizing the offering’s digital assets.” Grayscale’s Twitter post continued:
All digital assets that form the basis of Grayscale’s digital asset offerings are stored under the custody of Coinbase Custody Trust Company, LLC – to be very clear: [bitcoin] The underlying Grayscale Bitcoin Trust is composed of [GBTC and GBTC] alone.
Grayscale further added that Coinbase frequently confirms on-chain verifications, but the company never publicly discloses on-chain addresses to the public. “For security reasons,” Grayscale said. “We don’t do this [onchain] Wallet information and confirmations publicly available through cryptographic proof-of-reserves or other advanced cryptographic accounting procedures. “
The firm notes that it understands that proof of reserves not being shared may “disappoint some,” but Grayscale further stresses that “fears sparked by others are not sufficient reason to circumvent the complex security arrangements that keep our investors’ assets safe.” for many years.”
What do you think of Grayscale’s recent updates regarding safety and security related to the company’s digital asset offerings? Let us know your thoughts on this topic in the comments section below.
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