Grayscale Investment, one of the leading digital investment firms in the globe, has stated that it won’t be sharing details of its proof-of-reserve information due to security concerns.
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The news was announced by Grayscale through its official Twitter account. The firm said that it won’t share its on-chain wallet information with the public despite the pressure from its investors to do so because Grayscale claims that giving out such information would expose the company’s bypass security measures that have protected the assets of its investors for years.
The pressure being experienced by Grayscale to share information about its on-chain wallet through a proof-of-reserves is a result of panic by investors after the collapse of FTX and the resultant effect on the fall of Grayscale Bitcoin Trust (GBTC) and ether products.
Grayscale, however, has reassured its investors that their assets are safe and secure under the custody of Coinbase Custody Trust Company, LLC. The firm highlighted that all $BTC in GBTC is solely owned by $GBTC. Grayscale also hinted that each of Grayscale’s digital assets is built as a distinct legal entity and a limited liability corporation for a wide range of products.
Digital Firms Sharing their Proof-of-Reserves
Digital exchange firms are now being asked by their investors to disclose their holdings due to the abrupt collapse of the FTX Exchange. Therefore, some digital businesses have bowed to pressure and revealed documentation of their holdings.
Huobi Global, one of the world’s biggest crypto exchange platforms, recently published a report that disclosed the firm’s holdings to reassure customers about the security of their cash. The report stated that Huobi has an estimated amount of $3.5 billion in both its hot and cold storage. Huobi added that it would give information about its Proof of Reserves to its investors within the next 30 days.
In a similar situation, Kraken Exchange shared information about its proof-of-reserves by supplying a link with instructions on how to access proof-of-reserves in a Kraken wallet even though Kraken hid information about the total amount of its total reserves from its users.
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