Inspired by Ordinals Protocol, ORDI Token Plunges 14% as Bitcoin Drops Below $40k
The ORDI token, inspired by Casey Rodarmor’s Ordinals Protocol, experienced a significant drop of over 14% on Jan. 23, reaching a new monthly low. This decline was attributed to Bitcoin’s retracement below $40,000 and a broader market downturn. One speculation suggests that the nosedive in ORDI’s price is linked to Bitcoin’s movement and daily outflows from the Grayscale spot Bitcoin ETF.
Grayscale Spot BTC ETF Outflows Impact Bitcoin’s Price
Outflows from the Grayscale spot Bitcoin ETF resulted in sell pressure on Bitcoin’s price. The approval of spot BTC ETFs by the United States Securities and Exchange Commission (SEC) led to significant liquidation of actual BTC by asset managers like Grayscale. According to crypto.news, Grayscale offloaded over $2.1 billion worth of BTC since the SEC’s approval announcement, with $2 billion exiting its funds. Notably, FTX accounted for half of these outflows.
BTC Falls Over 20% as Other Institutional Investors Increase BTC Holdings
During the same period, Bitcoin experienced a decline of more than 20% and is down 10% this month, currently trading at around $39,300. While Grayscale’s ETF remains the largest with a market cap exceeding $20 billion and a BTC portfolio of 558,280 Bitcoins, other institutional investors such as BlackRock, Bitwise, Fidelity, and Franklin Templeton have increased their BTC holdings since the launch of ETFs on Jan. 11.
Hot Take: Institutional Investors Embrace Bitcoin Despite Market Downturn
Despite the recent market downturn and Bitcoin’s price retracement, institutional investors continue to show interest in Bitcoin. BlackRock, Bitwise, Fidelity, and Franklin Templeton now hold over 80,000 BTC, amounting to nearly $5 billion. This demonstrates the growing acceptance of cryptocurrencies by traditional financial institutions and their belief in the long-term potential of Bitcoin as a valuable asset.
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