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JPMorgan Says Grayscale Bitcoin Trust (GBTC) Can Expect Significant Outflows on ETH Approval

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If the entire .7 billion exits the bitcoin market, it would exert significant downward pressure on bitcoin prices, the authors stated. However, if most of this .7 billion transitions into other bitcoin instruments, such as the newly established spot bitcoin ETFs post SEC approval, the negative market impact would be more moderate. Nevertheless, the bank indicated that Bitcoin continues to face downside risks, as some of the .7 billion is likely to exit the Bitcoin space completely. The report also noted that more than .7 billion could leave GBTC if Grayscale doesn’t reduce its fee after converting into an ETF. Ark Invest Sells GBTC Shares Massively While Cathie Wood has been expressing her optimistic view on Bitcoin in recent months, her firm ARK Investment Management has actually

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If the entire $2.7 billion exits the bitcoin market, it would exert significant downward pressure on bitcoin prices, the authors stated. However, if most of this $2.7 billion transitions into other bitcoin instruments, such as the newly established spot bitcoin ETFs post SEC approval, the negative market impact would be more moderate.

Nevertheless, the bank indicated that Bitcoin continues to face downside risks, as some of the $2.7 billion is likely to exit the Bitcoin space completely. The report also noted that more than $2.7 billion could leave GBTC if Grayscale doesn’t reduce its fee after converting into an ETF.

Ark Invest Sells GBTC Shares Massively

While Cathie Wood has been expressing her optimistic view on Bitcoin in recent months, her firm ARK Investment Management has actually reduced its holdings in the Grayscale Bitcoin Trust.

According to Bloomberg’s compilation of daily trading data from the ETF provider, Ark Next Generation Internet ETF has sold over 700,000 shares of Bitcoin Trust since October 23. On Wednesday alone, it offloaded 36,168 shares. The Grayscale Bitcoin Trust allows investors to gain exposure to Bitcoin through a security.

Interestingly, these sales occurred even as Bitcoin reached its highest level since May 2022 earlier this month, experiencing a significant rally despite uncertainties arising from regulatory actions against crypto leaders such as Changpeng “CZ” Zhao of Binance Holdings Ltd. and Sam Bankman-Fried of FTX. Bitcoin has more than doubled in value this year.

It’s essential to note that the daily trading updates from Ark only reflect active decisions made by the management team and do not include creation or redemption activity resulting from investor flows. Despite these Bitcoin Trust sales, Ark’s internet ETF has seen a remarkable 65% increase for the year, outperforming the 46% advance in the Nasdaq 100 Index.

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