[Analysts believe Mt. Gox’s concerns are exaggerated, Bitcoin rebounds 5%]
A U.S. spot Bitcoin ETF saw net inflows reaching $31 million for the first time in two weeks, according to data analytics platform SoSovalue, showing institutional investors' new trust in Bitcoin. During this period, the price of Bitcoin increased by 3.5% from $59,495 to $61,485.
Fidelity's FBTC fund recorded the highest inflows at $49 million, while Bitwise's BITB fund recorded $15 million in inflows. In contrast, Grayscale’s GBTC fund recorded $30 million in outflows. Bitcoin ETFs have seen significant selling over the past five trading sessions, with net outflows reaching $714 million.
On June 24, Mt. Gox's trustees announced that they would begin repaying creditors next week, news that exacerbated the sell-off. However, one factor in the rise in Bitcoin prices may be the liquidation of derivative financial instruments. Nearly $62 million worth of short positions were liquidated in the past 24 hours, accounting for the vast majority of total liquidations.
Brian Dixon, CEO of Off the Chain Capital, said Mt. Gox creditors may not be eager to dispose of their decade-old holdings once they start accepting repayments. He doesn’t think the market will sell off these assets en masse right away because creditors won’t be in a hurry to sell their Bitcoins. He noted that Bitcoin has matured significantly and creditors may be more inclined to use Bitcoin as a long-term store of value.
Alex Thorn, director of research at Galaxy Research, echoed similar sentiments. He believes that the number of distributed coins from Mt. Gox creditors may be less than expected, and the selling pressure is also lower than market expectations. He noted that individual creditors are unlikely to sell their proceeds because they are long-term holders and had opportunities to sell claims within the past decade. Selling the reacquired BTC would also subject U.S. creditors to hefty capital gains taxes, as Bitcoin has surged over the past decade.
In summary, the net inflows into Bitcoin ETFs and the recovery in market prices show increased investor confidence, and the impact of the Mt. Gox repayment plan on the market may not be as large as expected.
