Victor Ugochukwu · Dec 14, 2020 . 5min read
Grayscale loses $1.6 million in AUM due to BCH split
Down from its recently published $9.8 billion AUM, Grayscale lost $1.6 million possibly due to dumping of BCH as the date of the hard fork drew nearer.
By Victor Ugochukwu · Nov 16, 2020 . 5min read
The largest cryptocurrency hedge fund by total asset under management (AUM) Grayscale loses $1.6 million due to the recent Bitcoin Cash (BCH) hard fork.
According to Grayscale’s Q3 reports, the private entity has $9.8 billion in total assets under management. However, with the recent chain fork, the Bitcoin Cash network recently experienced, the event has taken a toll on its AUM. Coin Insider recently reported about the Grayscale’s AUM.
Recall that the Bitcoin Cash network split some days back and that exchanges were seeing an influx of BCH. And before this split on November 15th, there was an earlier split from the split of Bitcoin. Bitcoin Cash is a split of Bitcoin backed by Roger Ver, Miner billionaire Jihan Wu and self-acclaimed Satoshi – Craig Wright. These former hard forked the Bitcoin mainchain in 2018 to create Bitcoin Cash Satoshi Vision (BSV) due to a disagreement in the block size.
Bitcoin Cash after that split again when the majority node Bitcoin Cash ABC run by Amaury Sechet unanimously proposed a controversial “Coinbase Rule”. Sechet “pigheadedly” argued that Bitcoin Cash ABC would roll out an update requiring miners to set apart 8% of block rewards. Bitcoin Cash ABC will then use the amount in the treasury to finance protocol development.
Before the split and Grayscale losses in AUM, BCH community threw weight behind BCHN as majority node.
Prior to the hard fork, Bitcoin Cash community rallied their support behind BCHN. The node mined the majority of the blocks hours before the split. BCHN is a community-driven initiative. Data from Coin Dance also shows that Binance Pool was responsible for mining the last block before the fork happened.
Perhaps the massive influx of BCH on exchanges before the split triggered Grayscale’s AUM depletion. BCH deposits on exchanges rose to $300 million within a week to the split event. Possible dumping could have followed.
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