After the conversion of Grayscale’s GBTC into a Bitcoin spot ETF, it has continued to face significant capital outflows, leading to a continuous decline in Bitcoin. In the first 8 trading days after the successful conversion, GBTC has accumulated net outflows approaching $4 billion. Bloomberg analysts predict that the ultimate outflow rate of GBTC will be between 20% and 35%. However, at least one-third of these outflows will reinvest in Bitcoin.
Since the approval of the Bitcoin spot ETF on the 10th, Bitcoin has continued to decline. Yesterday, it even fell below $39,000, reaching a new low since December last year. It is widely believed that this is due to GBTC investors continuously closing their positions due to factors such as the near-zero premium of GBTC and high management fees.
According to data from BitMEX Research, on the 8th trading day after the listing of the Bitcoin spot ETF, the net outflow of funds was $487 million, with a cumulative net inflow of $601 million in the first 8 days. On the 8th day, the net outflow of funds for GBTC was $515.3 million, with a cumulative net outflow of $3.963 billion in the first 8 days.
It should be noted that today’s outflow of $515.3 million from GBTC is lower than yesterday’s $640 million, and the current discount of GBTC relative to its net asset value has also decreased significantly (currently at a premium of 0.11%). This may indicate that the selling pressure of GBTC is decreasing.
Bloomberg analyst Eric Balchunas tweeted that GBTC has currently experienced a 13% outflow of funds. As for the future outflow rate of GBTC, another Bloomberg analyst, James Seyffart, predicts that it will be higher than 20% but not exceed 35%. However, Seyffart believes that at least one-third of the funds flowing out of GBTC will reinvest in Bitcoin, and perhaps more than half. These investors may choose to invest directly in Bitcoin or turn to other ETFs with lower fees.
Seyffart expects that with the outflow of GBTC, the net inflow of funds into the Bitcoin spot ETF this year will still reach $10 billion. The current net inflow is $1.1 billion, and there is still a long way to go.
When the Bitcoin spot ETF was just approved, GBTC held over $25 billion worth of Bitcoin. Ran Neuner, Co-founder and CEO of Onchain Capital, previously warned that Bitcoin may face a period of sell-off. $25 billion is a significant position, and even if only 20% is redeemed, it would mean $5 billion of sell-off in the market.
According to Arkham Intelligence data, GBTC still holds approximately 558,000 Bitcoins, worth about $22.15 billion. It is expected that the short-term trend of Bitcoin may continue to be volatile.
Meanwhile, Mt. Gox, the bankrupt cryptocurrency exchange, sent a recent email to its creditors stating that it will start the claims process. Yang Mindao, the founder of dForce, warned yesterday that Mt. Gox may unlock 200,000 Bitcoins in the next two months to pay off creditors. This means that Bitcoin may face additional potential massive sell pressure.
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