Arkham Announces On-Chain Address for BlackRock Bitcoin ETF

This article briefly:

-Arkham Intelligence has identified the addresses of four Bitcoin exchange-traded products, increasing the number of known U.S. spot ETF addresses to five.

-Coinbase is the custodian of eight of the 11 bitcoin ETFs and faces potential concentration risk, which could create a single point of weakness.

-Funds in Europe and Canada lost about 5,000 BTC after the launch of the U.S. Bitcoin ETF, leading to a significant drop in European fees.

Arkham Intelligence, an on-chain analytics firm, has identified four Bitcoin exchange-traded product (ETP) addresses. This latest discovery brings the number of exchange-traded fund (ETF) providers with known BTC addresses to five.

Arkham Intelligence has identified addresses for products offered by BlackRock, Bitwise, Fidelity and Franklin Templeton.

Bitcoin ETF Providers May Fear Public Exposure

Fidelity holds $1.21 billion worth of bitcoin in the Fidelity Wise Origin bitcoin fund with custodian Fidelity Digital Asset Services LLC, according to the data. BlackRock, Bitwise and Franklin Templeton hold $1.16 billion worth of bitcoin on the Coinbase Prime custodian platform. BlackRock, Bitwise and Franklin Templeton hold $1.16 billion, $422.68 million and $47.09 million worth of BTC on the Coinbase Prime custody platform.Litecoin DOGE Miner

Coinbase is the custodian for eight of the 11 bitcoin ETFs, which some refer to as concentrated risk. The custodian holds the private keys that enable address owners to move their BTC. Gemini, a cryptocurrency exchange founded by Cameron Winklevoss and Tyler Winklevoss, is the custodian for the VanEck Bitcoin Trust.

Last February, the SEC proposed new rules for cryptocurrency custodians. It plans to roll out those rules later this year.

Bitcoin ETF on-chain data | Source: Arkham Intelligence

The concentration of billions of dollars worth of cryptocurrencies could create a single point of failure. A cybersecurity breach or legal risk could jeopardize customer funds. a hack of the Coinbase database could reveal information about transfers that the organization may not want to make public.

CoinMetrics, an analytics firm co-founded by cryptocurrency venture capitalist Nic Carter, says it’s important for new research methods to emerge as Bitcoin grows. In a recent blog post about on-chain analytics, the firm said that

“As Bitcoin continues to evolve and mature, the need for critical research on it increases accordingly.”

Coinbase recently revealed that it has received over 12,000 law enforcement requests related to criminal matters in 2023. The exchange is currently engaged in a protracted court battle over the securities status of several crypto assets.Antminer Miner

US Bitcoin ETF Implications for Europe

Earlier this month, the launch of the U.S. Bitcoin ETF caused funds in Europe and Canada to lose about 5,000 bitcoins. Since then, European exchange-traded product (ETP) providers Invesco and WisdomTree have slashed their fees by as much as 60 percent. WisdomTree’s fee for its physical bitcoin ETP has been cut from 0.95 percent to 0.35 percent, while Invesco has reduced its fee for its physical bitcoin ETP from 0.99 percent to 0.39 percent of assets under management.

Until their U.S. counterparts come online, bitcoin ETFs in Europe and Canada are among the only regulated bitcoin products available to institutions.21Shares is ARK Invest’s U.S. bitcoin ETF partner and a prominent ETF provider in Europe.