The first of its kind, Bitcoin Future Exchange Traded Funds by Grayscale has been experiencing a great sell orders by the ETF holders. The primary reason why it was taking place was that people no longer need neither Grayscale's future ETFs called GBTC nor they need to buy the shares of Micro Strategy to be able to invest in Bitcoin in an indirect method.
Now, the ETFs already enable people to buy Bitcoin with spot Exchange Traded Funds. Thus, the sell pressure on GBTC and Micro Strategy shares are nothing surprising. As GBTC is sold, Grayscale has to liquidate their funds, by selling spot Bitcoin on Coinbase, so that they can cover their payments to the holders.
First of all, we need to give credits to GBTC and MSTAR for their services until the delivery of spot Bitcoin ETFs 🫡 They tried to open a new door for crypto to be " eligible " for the old but rich investors of stock markets.
Since the approval, the share has lost 39% due to the investors' buy the rumor sell the news strategy. People no longer need MSTAR while spot ETFs by BlackRock and others are alredy here.
GBTC Pressure Diminishes
As a result of that " weird " type of sell pressure, we had seen the price of Bitcoin dropped around $38K over the last 2 weeks. However, as the power of new Bitcoin purchases can easily outperform the sell wall of Grayscale's GBTC sells, the green days are coming back to crypto ecosystem.
As the pressure of GBTC sell off was not infinite nor sustainable, the market has started to recover slowly but firmly. The bars clearly show that there is net demand for Bitcoin whereas the amount of GBTC sells, which is on the side of net outflow, decreases over time.
Now, we can say that there is new money in crypto.
Though I expected the downtrend to keep continue as GBTC dominates, the demand outperformed the sells by Grayscale.
After that turning point, the eyes will be on the amount of net inflow into crypto ecosystem. Obviously, the narrative will be the increase in the volume of spot Bitcoin ETFs. Besides, the halving, the occasion that will cut down the production of new Bitcoin by half, will show its impacts after that day. Most probably, like it happened earlier, the post - halving effect will show itself over the next 6 months.
Earlier, I had some doubts due to the case that inflation might be too " sticky " around 3% and the interest rates in the U.S. may not go lower until the end of Q2. Yet, now that crypto has its own story to rise, it might be better to believe in the hype and narratives.
How do you feel about GBTC pressure on the market?
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Hive On ✌🏼
Posted Using InLeo Alpha
