Bitcoin

Bitfinex Moves $1B in Bitcoin for 48 Cents

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The origin and destination of the funds at first remained unknown. 

The transaction followed fresh developments in the court case involving Craig Wright, the Australian computer scientist who claims to be Bitcoin inventor, Satoshi Nakamoto. 

As Cointelegraph reported, Wright now says he can prove ownership of 1 million BTC ($8.6 billion). Available evidence nonetheless suggests he has only divulged publicly available information and has not proven ownership of the given private keys.

Against a backdrop of uncertainty surrounding Wright, fears were already palpable about a major selloff impacting the Bitcoin price. 

A fake tweet from Whale Alert purportedly showing a mass movement of 1 million BTC began circulating online shortly after Wright’s claims.

Fake Whale Alert tweet warning over a 1 million BTC transaction

Fake Whale Alert tweet warning over a 1 million BTC transaction. Source: Telegram

Commentators thus paid significant attention to the $1 billion transactions, with Whale Alert’s tweet receiving almost 1,000 retweets in under 12 hours.

In the event, however, its significance was a false alarm — cryptocurrency exchange Bitfinex was refilling its hot wallet.

“It’s a 1.5k BTC refill of hot wallet and resulting change address movement,” CTO Paolo Ardoino confirmed in a response.

Bitfinex paid just 48 cents to send the funds.

Exchanges hold 11% of BTC supply

Exchanges meanwhile are now in charge of a larger chunk of the Bitcoin supply than ever before, the latest data shows. 

Compiled by monitoring resource Glassnode, the statistics covering Bitcoin exchange balances show that as of Jan. 8, they controlled 2.12 million BTC — 11% of the supply.

Bitcoin exchange balances versus price, 2011-present

Bitcoin exchange balances versus price, 2011-present. Source: Glassnode

This includes both user balances and addresses known to belong to exchanges, such as cold wallets and those behind the Bitfinex transaction.

The trend accelerated over the course of 2019, despite community efforts to raise awareness of the risks involved in trusting third parties with Bitcoin private keys. Among these were Proof of Keys, the social media event organized by advocate Trace Mayer, which is now in its second year.





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