Analysts from banking giant JPMorgan believe that the profit-taking from the Grayscale Bitcoin Trust (GBTC) may have concluded, potentially alleviating the downward pressure on Bitcoin prices.
The analysts explained that they had estimated that GBTC could see as much as $3 billion in outflows from investors previously exposed to its discount. But with the flow now reaching as much as $4.3 billion since the ETF conversion, they believe that the “GBTC profit taking has largely happened already” and that “most of the downward pressure on Bitcoin from that channel should be largely behind us.”
This view is similar to that shared by Alistair Milne, the chief investment officer of Altana digital currency fund, who stated that the “GBTC selling should now be market neutral.”
Over the past weeks, BTC’s price has fallen by around 20% since the Securities and Exchange Commission (SEC) approved the launch of several spot Bitcoin ETFs in the U.S.
Observers have attributed this decline to the outflows from Grayscale’s fund, noting that it mainly had traded at a discount to its net asset value during the past two years. So, the ETF approval gave investors profit-taking opportunities on their previous GBTC investments.
BlackRock and Fidelity ETFs emerge as competitors.
JPMorgan analysts pointed out that BlackRock’s IBIT and Fidelity’s FBTC have emerged as major competitors for GBTC (the
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Author: Oluwapelumi Adejumo
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