Coindesk revealed on Monday night that FTX has sold nearly $1 billion worth of GBTC shares since the conversion of Grayscale’s GBTC to a Bitcoin spot ETF. Since the approval of the Bitcoin spot ETF by the U.S. Securities and Exchange Commission (SEC), the price of BTC has been steadily declining from its high of $48,969 on the 11th. In the early hours of the 23rd, it fell below the $40,000 mark and is currently oscillating around $39,750.
According to sources, the recent decline in the price of Bitcoin is believed to be due to Grayscale GBTC investors realizing significant profits after the discount approached zero. In a recent report, Coindesk disclosed that FTX, including the bankruptcy liquidation team, has sold approximately 22 million shares of GBTC, worth nearly $1 billion, emptying their holdings of GBTC.
According to legal documents submitted by FTX on November 3, 2023, as of October 25, 2023, FTX held 22.3 million shares of GBTC, valued at nearly $600 million. On the first day of trading after GBTC was converted to a Bitcoin spot ETF on the 11th of this month, the value of FTX’s GBTC holdings rose to around $900 million, with a closing price of $40.69.
Bloomberg reported today, citing sources, that FTX has sold more than two-thirds of its total holdings, totaling 22.28 million shares, in the first three trading days of GBTC’s conversion to an ETF, with an estimated amount exceeding $600 million.
Perhaps due to the discount approaching zero, Alameda Research, an affiliated company of FTX, has also voluntarily withdrawn its lawsuit accusing Grayscale of charging excessive fees for GBTC.
According to Coinshares data, more than $2.9 billion has been withdrawn from GBTC since its conversion to a spot ETF. However, according to the Grayscale official website, GBTC still manages over $22.1 billion in assets.
If FTX has indeed sold almost all of its GBTC holdings, it is expected to alleviate a significant source of selling pressure on GBTC in the future.
BTCdata’s Chief Architect, Chris J Terry, warned on the 21st that the price of Bitcoin will continue to remain flat or decline until GBTC liquidation is completed. Grayscale’s decision to maintain the ETF management fee at 1.5% will be the biggest strategic mistake in the history of cryptocurrency.
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