Bitcoin Holds $40K as Heavy Tide of BTC ETF Outflows Slows
- Despite liquidating $9.39M of long positions, BTC climbed back above $41K on Friday.
- BTC holders were relieved to see a slowing pace of Grayscale ETF outflows finally.
- Grayscale’s GBTC holdings comprise $21.5 billion in assets under management (AUM).
After consecutive weeks of a downward trend, the king crypto Bitcoin (BTC) is racing back towards $42,000 with a 3.4% upswing in the last 24 hours. Notably, the positive change in Bitcoin’s price trend comes after a 20% deficit since The Securities and Exchange Commission (SEC) approved all 11 inaugural Bitcoin exchange-traded funds (ETFs) on January 10, 2024.
According to the Elliott Wave trading theory, crypto startup owner Matthew Dixon spotted a breakout opportunity for BTC. As portrayed in the graphic below, the trendline underlying the price of $40,299.99 has already been breached, as Bitcoin soared past the mark despite $9.39M in long position liquidations over the past 24 hours.
At the time of publication, the largest digital asset, BTC, trades at $41,205.56, according to CoinGecko. Bitcoin’s chances for closing above $42,000 on the weekly charts heavily depend on the 633094f1-a343-4d36-9fcd-344d394e9cb9 sentiment, as Bitcoin holders finally saw a break from the continuous outflows of the largest ETF.
$4.4B In Outflows: Is the Grayscale ETF Storm Over?
With a combined order book of over $2.08 billion in bids, Bitcoin’s road to $42K has fewer obstacles since Grayscale’s GBTC ETF investors have put a pause on massively exiting their ETF positions. The biggest Bitcoin ETF managers’ clients have dumped $4.4 billion onto the markets in less than three weeks since the Bitcoin ETF approval was granted.
Besides, the fallen FTX exchange added more selling pressure for BTC custodians in the last few weeks by dumping over $1 billion worth of GBTC shares. As FTX sold Grayscale’s shares, the bankrupt crypto exchange’s estate also dropped its lawsuit against the American digital currency investment giant.
According to a Crypto.com subsidiary, the outflows from the Grayscale Bitcoin Trust (GBTC) have slowed since January 24, 2024. However, the digital currency asset management heavyweight still has $21.5 billion worth of BTC under management.
On the Flipside
- The fund outflow from Grayscale’s GBTC ETF doesn’t necessarily indicate the customer’s distrust in Bitcoin as a long-term investment opportunity.
- Many traders are rumored to have exited positions because of the 1.5% management fee compared to competitors’ 0.2%.
Why This Matters
Bitcoin ETFs make a ground-breaking adoption case for Bitcoin and crypto. However, breakthroughs like this often become a ‘Buy the Rumor, Sell the News’ case for retail investors.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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