- CryptoQuant, a prominent cryptocurrency data analytics firm, questions Tether’s status as the 11th largest Bitcoin holder using on-chain data.
- According to Tom Wan, a research analyst, Tether’s reported holdings align with an address’s balance in Q1 and Q2.
Through a recent sequence of Twitter posts, CryptoQuant, a notable data analytics company in the cryptocurrency sector, has expressed doubts about Tether’s standing as the 11th most significant holder of Bitcoin, utilizing on-chain data. The tweets explore the limitations in on-chain data’s ability to fully track the activities of cryptocurrency whales.
1-3/ Can we verify @Tether_to being the 11th largest #Bitcoin holder with the on-chain data?
4-6/ What is the blind spot of on-chain data when monitoring #Whales‘ behavior?
Let’s BUST this week’s FUDs with our on-chain data.
Thread🧵
— CryptoQuant.com (@cryptoquant_com) August 10, 2023
The discussion begins by questioning the accuracy of Tether’s assertion regarding its position as the 11th most significant holder of Bitcoin. Tether’s quarterly report stated a substantial Bitcoin holding of around $1.6 billion, placing it among the top holders. Yet, CryptoQuant’s analysis raises uncertainty about the alignment between the data in Tether’s report and what is visible in the Tether Bitcoin holding wallet on Twitter.
Curiously, the Q4 report of the previous year showed no Bitcoin holdings, yet the wallet under scrutiny started amassing Bitcoin during that same period. This discrepancy between Tether’s official report and the observed on-chain actions has generated curiosity and triggered a more thorough data analysis.
In response to these uncertainties, CryptoQuant proposes that Tether could have other Bitcoin wallets besides the one being examined. The data analytics company underscores the trustworthiness of on-chain data to verify information during periods of uncertainty.
Difficulties in Identifying Bitcoin Whales
The discussion highlights a critical issue with interpreting on-chain data. It’s common to label entities with over 1,000 Bitcoins as “whales.” Nonetheless, the analysis reveals a limitation in this classification approach, cautioning against potential oversights in recognizing individual distinctions while categorizing entities as whales.
Crypto Quant further clarifies that this omission could lead to mistakenly categorizing specific wallets as “whales” when they could pertain to exchanges or internal reserves. It underscores the necessity to be cautious when solely relying on this categorization method, as it can lead to misconceptions and erroneous deductions.
CryptoQuant goes on to analyze recent patterns in the transfer of Bitcoin across various ranges (1,000 to 10,000 and 10,000+), along with a notable increase in withdrawals from exchanges. These observable trends were primarily evident between May and July. However, the analysis indicates that these shifts might be connected to wallets within the Robinhood app rather than indicating broader market trends.
Alignment with Tether’s Reports: Analyst’s Observations
Tom Wan, a research analyst at 21.co, discovered in the previous quarter that Tether might have kept all its Bitcoin in a single wallet, positioning them as the 12th largest BTC holder then. Looking ahead to Q2 2023, the analyst has verified his initial suspicions.
1/ .@Tether_to BTC balance increased by $176M compared to last q
– Using the price as of 30 Jun, it is estimated that they hold ~55,022 BTC
– Last Q, I mentioned the below address could belong to Tether:
bc1qjasf9z3h7w3jspkhtgatgpyvvzgpa2wwd2lr0eh5tx44reyn2k7sfc27a4 pic.twitter.com/90DGmqQvLS— Tom Wan (@tomwanhh) August 4, 2023
During the first quarter, the BTC holdings in Tether’s “potential” wallet address aligned with the BTC quantity disclosed in the company’s attestation report. Furthermore, the BTC balance of this address has grown in the second quarter, matching the figure presented in Tether’s Q2 report.
The analyst pointed out a significant detail: just a single Bitcoin address aligns with Tether’s BTC reserves figures. This particular address, possibly belonging to the stablecoin issuer, currently holds the 11th spot as the world’s largest Bitcoin holder.
Although Wan attempted to verify his findings with Tether and the company’s CTO, Paolo Ardoino, the stablecoin issuer has not provided any official confirmation.
Crypto News Flash does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products, or other materials on this page. Readers should do their own research before taking any actions related to cryptocurrencies. Crypto News Flash is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods, or services mentioned.
