Grayscale’s recently launched Bitcoin ETF (GBTC) has seen around $5 billion in digital assets withdrawn from the fund, with outflows gradually decreasing.
Despite heavy capital outflows, market analysts remain optimistic that the worst may be over. This sentiment suggests a potential positive shift in Bitcoin’s price performance.
Bitcoin outflow slows down
Bitcoin experienced a notable 20% decline after the US Securities and Exchange Commission (SEC) recently approved several spot Bitcoin ETFs. Significant outflows from Grayscale primarily fueled this downturn.
Analysts believe the large outflows were due to profit-taking by investors who were previously exposed to the fund’s discount. Additionally, there were indications that some traders were reallocating their investments away from GBTC due to relatively high fees.
GBTC currently charges 1.5% in fees, while competing ETFs such as BlackRock’s IBIT charge less than 1%.
These factors played a pivotal role in the initial surge in outflows from the fund. However, recent trends indicate a slowdown, with $255 million withdrawn on the 11th day of trading, the lowest GBTC outflow since the first day of trading. Still, total outflows from the fund exceeded $5 billion, according to BitMEX Research.
At the same time, this decline has significantly reduced Grayscale’s Bitcoin balance, which now stands at more than 508,000 BTC (worth $21 billion), according to Arkham Intelligence. It is worth noting that since the launch of the Spot Bitcoin ETF, the fund has deposited 113,129 BTC, worth $4.6 billion, into Coinbase.
BTC price recovers
Market analysts interpret the decline in GBTC outflows as a positive indicator of the Bitcoin price trajectory.
For example, recently JA Maartun share Graph showing the decreasing influence of grayscale on BTC price. Despite the decline, Bitcoin’s value not only remained stable, but also showed a remarkable increase.
“All the selling pressure from Grayscale has been absorbed and the price has been able to go up, which is great,” Martun said.
Another analyst, Ted, was fired GBTC sales stories are overly sensationalized. His analysis revealed that over the past 90 days, Bitcoin inflows into the market through nine new spot BTC ETFs exceeded outflows from GBTC by more than 120,000 BTC.
On the other hand, Resdegen highlighted Bitcoin’s resilience to trade above $41,000 despite various selling pressures. Analysts pointed to key factors such as the large outflow of GBTC, the US government’s announcement of the sale of $130 million worth of seized BTC, and the $1 billion ETH movement by Celsius, but these are hypothetical It appears that there was no negative impact on the currency’s top price.
Resdegen expected bullish signals on the horizon and highlighted the possibility that bears will face significant challenges, especially with the upcoming BTC halving event.