Grayscale Sees Record $500 Million Inflows as Institutional Investors Buy the Dip

Crypto asset manager Grayscale Investments has raised a total of $503.7 million in the first quarter of this year, nearly doubling its previous record high of $354.8 million in Q3 2019.

The cryptocurrency-focused investment firm revealed that last month’s crypto market crash largely contributed to its record inflows as institutional investors bought the crypto market’s dip, betting on Grayscale’s Bitcoin Trust (GBTC) Ether Trust (ETHE) and other products to gain exposure to the cryptocurrency space.

In comparison Grayscale, a unit of the New York-based Digital Currency Group, raised a total of $600 million in 2019, the year that had its previous record quarter.

According to the firm, inflows also surpassed #1 billion over the last 12-month period, a new record for the company. As a result, the total value of assets under management for Grayscale has now surpassed the $2.2 billion mark.

Notably, institutional investors reportedly made up 88% of the total investments in the first quarter of this year, with the majority of them being hedge funds gaining exposure to the cryptocurrency space. Over the last 12 months, 79% of investments came from institutional investors, the lion’s share being hedge funds.

Per Grayscale, evidence suggests that even in the current risk-off climate prompted by the coronavirus-induced market crash last month, investors are “increasing their digital asset exposure at current levels.” Increased volatility over the last quarter, the announcement adds, presented an opportunity for investors.

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'Big Spender' Bitcoin Wallet Exploit Is an 'Issue With BTC Itself', Says BCH Supporter

Michael LaVere
  • Crypto security firm ZenGo has identified a double-spend exploit dubbed "BigSpender" which affected popular bitcoin wallets.
  • Exploit allows an attacker to cancel a bitcoin transaction without the receiving user knowing. 

A crypto security firm has identified a double-spend exploit targeting popular bitcoin wallet providers. 

According to a report by ZenGo, the security firm has discovered a double and multiple spend wallet exploit for bitcoin dubbed “BigSpender.” The report claims the exploit allows an attacker to cancel a bitcoin transaction but still have it appear in a victim’s vulnerable wallet. 

The report reads, 

The core issue at the heart of the BigSpender vulnerability is that vulnerable wallets are not prepared for the option that a transaction might be canceled and implicitly assume it will get confirmed eventually.

As CryptoGlobe reported, ZenGo found that a user’s balance would be increased following an unconfirmed incoming transaction, without a subsequent decrease in the event the transaction being double-spent. The firm outlined how an attacker could use the exploit to cancel transactions of sent bitcoin while still receiving goods and services in return. 

The security firm tested nine popular cryptocurrency wallets and found BRD, Ledger Live and Edge to be vulnerable to the exploit. All three companies were notified by ZenGo of the threat and subsequently updated their products. However, the firm noted that “millions” of crypto users may have been exposed to the attack prior to the update. 

Bitcoin Cash supporter Hayden Otto told Cointelegraph the exploit is particularly concerning for bitcoin-accepting merchants. 

He said, 

The technique is facilitated by RBF (replace by fee), a so-called ‘feature’ added at the protocol level by the Bitcoin Core developers.The issue exists if you use BTC. Wallet software can only make some trade off, which results in a worse BTC user experience, in order to try to protect BTC users.

Otto claimed the exploit was derived from “an issue with BTC itself” and had little to do with wallet software. 

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