An astounding 32 million bitcoin cash (BCH), worth approximately $2,3 billion, have been moved in the last 24 hours. This equates to more than the total supply of bitcoin cash (128%). When it comes to transfered value, BCH's network saw over 25 times more value move than that of ETH, but fell shy of the BTC network's $3.1 billion.
The unexpected movement does not come from an increased number of transactions, however, as in said peeriod bitcoin cash had little over 8,000 transactions on its network, compared to Ethereum's over 500,000.
Why Is So Much BCH On The Move?
TrustNodes speculates that Coinbase may be behind the move. The company is splitting all the wallets that held both Bitcoin Cash - which got the BCH ticker on most crypto exchanges after the hard fork - and Bitcoin Cash Satoshi's Vision (BSV), in order to prevent security issues due to BSV's lack of relay protection.
The crypto exchange recently published a notice of “blockchain movements”, announcing a scheduled maintenance to improve security:
“Over the next seven days, Coinbase will be running scheduled maintenance across our platform that may cause movements on all Coinbase-supported blockchains. These are controlled, closely monitored movements that are being performed in order to provide enhanced security and protection for our customers. Updates will be posted to status.coinbase.com, status.pro.coinbase.com and status.prime.coinbase.com.”
According to Coinbase's website, the company keeps 98% of customer funds stored offline in cold storage. Customer funds are kept in USB drives and paper wallets distributed in vaults and safes around the world.
Due to its security measures, Coinbase may be inclined to split funds into many different cold storage wallets in order to minimize risk. That could explain the high amount of bitcoin cash being transacted.
Coinbase Could've Moved 32 Million BCH
The current theory is that Coinbase moved its funds to claim BSV tokens on behalf of its users, and then proceeded to move the funds back to keep them safely stored. It's believe the cryptocurrency exhcnage has about 2 million BCH, which means that such a large amount could mean another cryptocurrency exchange did the same thing, or has been reorganizing its cold sotrage system.
Presumably as part of the new security measures, TrustNodes also states that Coinbase moved 856,000 BTC between December 1 and 6. Although all of its systems are now normal, Coinbase did have issues yesterday. The links from the “blockchain movement notice” informed that the service was “partially degraded”, after having “intermittent issues” a few hours earlier.