A friend asked me what I thought about the recent plunge in Bitcoin.
The main reason for the recent decline is Grayscale’s monetization
1: Grayscale’s GBTC has always been a time bomb after passing the ETF. The last article said that if the Bitcoin ETF passes, it will definitely be a negative.
2: To put it simply and easily understood, Grayscale has changed from "all eating but not vomiting" in the past to "all vomiting but no eating", and this is closely related to its high handling fees.
3: At the same time, there are also some mining farms and speculation pursuing short-term profits, which also explains the recent market weakness. Of course, one of the more important goals is to clean up leverage.
After the ETF was passed, too many gamblers opened long orders at high prices, and a violent shock was needed to make the market healthier.
Over the years, there have always been people leaving the big pie market and people coming in, but the market may have paid more attention to the news of Grayscale’s currency sales, while ignoring the surge in market demand after the adoption of the ETF.
The adoption of ETF will definitely be a great benefit in the long run, because there is history to prove it. Any ETF listed on U.S. stocks has a probability of falling at the beginning and then continuing to rise like Nasdaq.
However, everything has two sides, and long-term benefits cannot affect short-term selling and market consolidation.
BlackRock ETF and other companies will not allow the market to rise all the way, otherwise they will become the role of taking over.
What we retail investors have to do now is to reasonably control our positions, not to be affected by negative drops, and to wait and see when there is a sharp drop. Because we don’t know when the market will suddenly rise after the ETF is passed, and we don’t know to what extent the market makers will control the market, but I personally think the bottom line should be 38,000-39,000. According to statistics, the absolute liquidation position is also in the 39,000 range, and the bottom is only 36,000, because there is no liquidation. Follow Niu Erli to interpret the blockchain and guide you in the right direction.
