Grayscale Bitcoin Trust Witnesses Outflows Amid Bitcoin ETF Approval
Since the approval of spot Bitcoin ETFs, the Grayscale Bitcoin Trust (GBTC) has experienced systematic outflows as investors rotate their capital to other Bitcoin ETFs offered by BlackRock and Fidelity, which have lower fees.
Grayscale Offers Private Placement Subscriptions for Altcoin Trusts
Crypto analyst Colin Wu reports that Grayscale has launched private placement subscriptions for several cryptocurrency trusts, available to accredited investors. These trusts include Bitcoin Cash, Chainlink, Litecoin, Solana, and Stellar Lumens. Investors can subscribe based on each trust’s net asset value.
Grayscale introduced these products in recent years to provide institutional players with exposure to various crypto assets in the absence of regulation. However, the high management fee has deterred institutional investors from Grayscale products, resulting in significant outflows from GBTC.
GBTC Outflows Continue Despite Recent Drop
Although GBTC outflows briefly decreased earlier this week, they have resumed their upward trend. On Wednesday, GBTC outflows totaled $131 million. However, inflows from BlackRock and Fidelity have surpassed these outflows, supporting the rise in Bitcoin prices.
Bitcoin ETFs Absorb More Supply Than Newly Minted Bitcoins
Gemini co-founder Cameron Winklevoss believes that Bitcoin ETFs play a crucial role in reducing the available supply of Bitcoin. He notes that currently, Bitcoin ETFs are absorbing ten times more Bitcoin from the market daily than are being newly minted. If this trend continues after the Halving event, ETFs could remove twenty times more Bitcoin from circulation daily compared to the newly minted supply.
Bitcoin ETF Inflows Decrease
However, on Wednesday, Bitcoin ETF inflows dropped by 50% from the previous day’s high. The total inflows into Bitcoin ETFs stood at $339 million, down from $631 million.
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