Bitcoin has once again regained a trading price of $42,000 after a week characterized by downtrends. The price drop was fueled by a massive sell-off recorded by the asset management firm Grayscale on its flagship ETF product.
Grayscale’s Selling Spree Slows Down
On January 10th, Grayscale’s GBTC was one among 11 spot Bitcoin exchange-traded funds (ETFs) that got approved. The asset management company took the leading position in terms of trading volume, holding nearly half of the market share in just 24 hours after approval.
Reports confirmed on January 22nd that the bankrupt crypto derivatives exchange FTX sold off almost $1 billion worth of GTBC. Several investors followed the same path, pulling their funds from Grayscale’s GBTC product. In one instance, the firm saw more than $515 million exit its platform in a single day. Presently, the selloff has reduced as Grayscale’s total sales total $4.3 billion, signifying a possible slowdown in the selling spree.
The massive exodus recorded in Grayscale’s Bitcoin ETF business has benefited other financial institutions offering the same product. For example, BlackRock’s IBIT and Fidelity’s FBTC continued to record inflows throughout the week while Grayscale saw outflows.
Meanwhile, Bitwise became the first ETF issuer to publicly disclose the Bitcoin wallet address holding its ETF proceeds. While the move may likely bring more investors into its ecosystem, the firm noted that the action will bolster transparency. Since then, the company has seen donations poured into its wallet address. These additional funds will be issued to investors in Bitwise’s BITB investment vehicle.
BTC Trades at $42K
After a troubling week for the leading cryptocurrency, it has bounced back to a current trading price of $42,000. BTC’s downward spiral earlier this week saw its lowest on January 23rd when it traded around $38,600.
However, the asset began seeing uptrends earlier today, causing its latest impressive price performance.
