- Bitcoin Whales Move BTC for First Time in Years.
- This occured on 17 December 2022.
- The Bitcoins are from cold wallets of a popular cryptocurrency exchange, QuadrigaCX.
A collection of bitcoin addresses that most likely belonged to the cold wallets of collapsed exchanges have been found by researchers.
Blockchain watchers have discovered a collection of bitcoin addresses that most likely come from one of the bankrupt cryptocurrency exchange QuadrigaCX’s “cold wallets.”
The finding is significant given that QuadrigaCX claims that since the passing of CEO Gerald Cotten in December, it has been unable to access these wallets, which contained the majority of the $190 million owing to clients. The corporation claimed in court documents that Cotten was only transferring money from the exchange’s “hot,” or active, wallet to offline “cold” storage.
However, Quadriga withheld the addresses of its cold wallets, leading many researchers to attempt to track transactions to identify the wallets in question and confirm whether the $136 million in cryptocurrencies, including roughly $92 million worth of bitcoin, that was rumored to be held offline, were present. (Payment processors have also held back an additional $53 million in fiat currency from clients.)
On Tuesday, QuadrigaCX’s court-appointed monitor in the creditor protection case, Ernst & Young (EY), provided a hint. According to EY’s initial progress report to the Canadian court, Quadriga accidentally sent 103 BTC (or roughly $350,000) to “cold wallets which the Company is now unable to access” on February 6.
Internet detectives later discovered a collection of addresses that had received several minor transfers totaling 104.335 bitcoin on that day, approximately the same sum described in the report. These addresses had only experienced transactions before this since April.
On Wednesday, Reddit user Decoze shared the addresses of several wallets:
- 1HyYMMCdCcHnfjwMW2jE4cv9qVkVDFUzVa — received 36.37786282 BTC.
- 1JPtxSGoekZfLQeYAWkbhBhkr2VEDADHZB — received 33.19556316 BTC.
- 1MhgmGaHwLAvvKVyFvy6zy9pRQFXaxwE9M — received 19.54328527 BTC.
- 1ECUQLuioJbFZAQchcZq9pggd4EwcpuANe — received 10.34268585 BTC.
- 1J9Fqc3TicNoy1Y7tgmhQznWrP5AVLXj9R — received 4.87560516 BTC.
The first address once received a tiny sum of bitcoin from 3N8auHdN9rtmHDHqNnXK4eWhfukBAQcve1, the exact address named QuadrigaCX’s hot wallet by the exchange’s operators in a court affidavit, serves as more evidence for the connection.
Additionally, two blockchain analysis websites, Walletexplorer and OXT, have previously “clustered” those five addresses together or determined that they belonged to the same company.
According to Laurent, an OXT engineer who would not give his last name, the cluster is thought to be connected to QuadrigaCX based on the patterns of transactions it transmitted and received.
Careful Now
When examining the bitcoin blockchain or any other public ledger that depends on unspent transaction outputs, it’s crucial to exercise caution (UTXOs).
In contrast to account-based Ethereum, a bitcoin “wallet” is frequently a collection of addresses rather than just one. Addresses in the UTXO paradigm refer to transaction outputs or the portions into which original bitcoin amounts are divided during transactions rather than accounts.
Laurent described how OXT connects addresses as “these addresses are automatically clustered owing to a script executing a conservative version of a procedure termed the merged inputs heuristic’.” The Merged inputs heuristic’ states that all addresses connected to a bitcoin transaction’s inputs are under the control of the same entity and should be grouped in their most basic form.
Laurent cautioned that, by its very nature, bitcoin blockchain analysis could not result in comprehensive, clear-cut results.
