A Broad Market Rally as Bitcoin Resists Sell Pressure from Grayscale GBTC ETF Outflows
Bitcoin’s surge above $41,000 on January 26 had a positive impact on the overall crypto market, leading to price increases for numerous cryptocurrencies. According to CoinMarketCap, around 10 tokens experienced double-digit price jumps within 24 hours.
Tokens with Significant Gains
Among the top gainers was the Bitcoin BRC-20 token 1000SATS (SATS) with a 21% increase. Conflux (CFX), known as ‘China’s Ethereum,’ followed closely with a gain of over 15%. Ethereum Name Service (ENS) also saw a notable rise of 14%. Conflux announced plans for a Bitcoin L2 by mid-year, while ENS received recognition from Vitalik Buterin, co-creator of Ethereum, in early January.
Other Top Gainers
Akash Network (AKT), Optimism (OP), Near Protocol (NEAR), Bonk (BONK), ORDI, Chiliz (CHZ), and OKB were also among the cryptocurrencies that experienced significant price increases on January 26.
Is the Bitcoin Sell-Off Slowing Down?
Analysts at JPMorgan suggest that consecutive negative net flows for Grayscale’s GBTC exchange-traded fund may be losing momentum. It is believed that profit-taking, likely from arbitrageurs trading GBTC’s net asset value discount, has resulted in approximately $3 billion in outflows.
The FTX estate, led by CEO John J. Ray III, has also sold around $1 billion worth of Grayscale converted Bitcoin ETF. This adds to the over $4 billion shed by GBTC in just over two weeks. Bloomberg expert Eric Balchunas predicts a 25% decrease in Grayscale’s BTC ETF market cap. GBTC currently holds over $20 billion in value and Bitcoin.
Additionally, investors may have shifted towards ETFs with lower fees, as Grayscale charges a high fee of 1.5%, while competitors offer much lower fees ranging from 0.21% to 0.35% after fee waivers.
Hot Take: Market Gains and Decreased Sell Pressure Signal Positive Momentum
The recent rally in the crypto market, fueled by Bitcoin’s surge and the resistance to sell pressure from Grayscale GBTC ETF outflows, indicates positive momentum. With multiple tokens experiencing double-digit price increases, it is clear that the overall sentiment is bullish.
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