A community-led effort to identify GBTC’s addresses is underway.

On Nov. 19, the Grayscale Bitcoin Trust (GBTC) said it would not make on-chain wallet information and transaction confirmations public through a cryptographic Proof-of-Reserve due to “security concerns.”

“We know the preceding point in particular will be a disappointment to some, but panic sparked by others is not a good enough reason to circumvent complex security arrangements that have kept our investors’ assets safe for years,” said Grayscale.

GBTC is one of the largest legal holders of Bitcoin in the world and claims to hold 663,000 BTC. The fund, which is known to have traded at a considerable premium, is now trading at 45% discount to NAV – the lowest it has ever been. 

GBTC said that it is the sole owner of all the underlying BTC it holds which are custodied on Coinbase.

Still, some market participants, unsatisfied with the entity’s reluctance to release its Proof-of-Reserve, have taken matters into their own hands. 

ErgoBTC of OXT Research uncovered the identities of GBTC addresses and balances by tracing public information on-chain. By tracing funds transferred to Coinbase from Grayscale’s security provider Xapo, ErgoBTC created a “nearby graph” of corresponding transactions.

“In total, we were able to attribute 432 addresses with a total balance of about 317,705 BTC to likely GBTC TXOs held by Coinbase Custody,” said ErgoBTC.

This 317,705 BTC is around 50% of GBTC’s reported current holdings. ErgoBTC noted that additional work is necessary to identify the remaining addresses, but believes these initial findings could serve as a starting point for other researchers.