Bitwise, the provider of the BITB Bitcoin ETF, has taken a significant step towards transparency by publicly disclosing the Bitcoin address of its spot Bitcoin ETF holdings. This marks the first instance of a Bitcoin ETF provider in the United States embracing such transparency, addressing concerns that have long lingered in the space regarding the opaqueness of fund reserves.
The announcement, made on January 24, is a commendable stride towards increased public transparency, according to a post by Bitwise on X (formerly known as Twitter). The company expressed its commitment to evolving with the industry’s infrastructure, hinting at future collaborations with firms like @hosekiapp to provide real-time cryptographic attestations.
Bitwise’s BITB ETF currently holds the position as the third-largest spot bitcoin ETF by total assets, with holdings exceeding $490 million, as reported by BitMEX research. The move to disclose the Bitcoin address is expected to set a precedent for other ETF providers, fostering investor confidence and establishing a new industry standard for transparency.
Anyone can now verify the claimed value of the BITB ETF’s bitcoin holdings by visiting the Bitwise BITB site, retrieving the disclosed bitcoin address, and checking it on a bitcoin explorer. As of the latest information, the ETF’s holdings stand at approximately 12,338 BTC, equivalent to around $492,661,703.
Hoseki, a Bitcoin proof-of-funds infrastructure provider, has also entered the scene, collaborating with Bitwise to establish new industry standards around Bitcoin reserve transparency. This partnership signifies a collective effort within the industry to promote best practices and build trust among investors.
Bitwise CTO Hong Kim clarified on X (formerly Twitter) that the absence of outflows from the disclosed address is due to Coinbase custody’s practice of not reusing addresses after spending. In case of a net outflow day, Bitwise would transfer all funds to a new Bitcoin address, necessitating an update on their website address list.
Looking ahead, Bitwise is expected to provide more details on the setup of its bitcoin holdings, potentially revealing whether they employ off-chain multisig, Shamir’s Secret Sharing (SSS), or Multi-party computation (MPC).
Beyond the technical aspects, Bitwise continues to distinguish itself in the market by allocating 10% of its profits from the BITB ETF to support bitcoin development through sponsorships to organizations such as the Human Rights Foundation (HRF), Open Sats, and Brink. These efforts, combined with the disclosure of its Bitcoin holdings address, contribute to Bitwise’s growing list of differentiators in the highly competitive Bitcoin ETF landscape.
In a noteworthy development, since Bitwise disclosed its address, micropayments have been sent to the BITB bitcoins address, indicating a positive reception from the community and potentially establishing a trend of “tipping” ETFs in the crypto space.