Arkham Intelligence identifies on-chain addresses of four major spot BTC ETFs, raising transparency and security debates in the industry.
Arkham Intelligence, a renowned blockchain research platform, has successfully pinpointed the on-chain addresses associated with Bitcoin (BTC) backing several prominent spot BTC exchange-traded funds (ETFs) in the United States. This discovery, announced on X (previously known as Twitter) on January 22, marks a notable achievement in the transparency of cryptocurrency operations.
Arkham’s innovative research led to the identification of the on-chain locations for Bitcoin ETFs issued by leading financial institutions including BlackRock, Bitwise, Fidelity, and Franklin Templeton. This advancement allows for direct verification of transaction hashes conducted by these four spot Bitcoin ETFs on the Bitcoin blockchain itself.
Insight into Bitcoin Holdings
Delving into the details revealed by Arkham, BlackRock’s iShares Bitcoin Trust (IBIT) currently possesses a substantial amount of 33,430 BTC, valued at approximately $1.3 billion. This figure aligns with the publicly disclosed data on IBIT holdings available on BlackRock’s website, reinforcing the accuracy of Arkham’s findings.
Prior to this revelation, Arkham had also successfully identified the addresses of the Grayscale Bitcoin Trust (GBTC) in September 2023. Following its conversion to a spot Bitcoin ETF, a move approved by the U.S. Securities and Exchange Commission on January 10, 2024, GBTC emerged as the largest among such funds. It holds an impressive 558,280 BTC, translating to nearly $29 billion at the current valuation.
Despite these strides, Arkham’s work is far from complete. The platform is yet to uncover the addresses of five additional spot Bitcoin ETFs operating in the United States. These include offerings from ARK Invest and 21Shares, Invesco and Galaxy, VanEck, Valkyrie, and WisdomTree.
The Debate Over Transparency and Security
The identification of on-chain addresses for spot Bitcoin ETFs is a topic of considerable debate within the cryptocurrency community. Many enthusiasts and experts advocate for the publication of Bitcoin addresses backing ETF products to guarantee the safety of the underlying BTC assets. This transparency, some argue, is essential for boosting investor confidence and competitiveness in the sector.
However, this push for openness is not without its detractors. Concerns about the potential security risks of revealing on-chain addresses for spot Bitcoin ETFs have been raised. For instance, Grayscale, in November 2022, chose not to disclose its on-chain wallet information, citing security concerns as the primary reason.
Lastly, Ophelia Snyder, co-founder of 21.co and 21Shares, has echoed similar sentiments. Snyder cautioned against the potential risks associated with such disclosures. She highlighted the complexities and unintended consequences that could arise from exposing wallet addresses, especially in terms of trading infrastructure.