Genesis Likely Behind GBTC Outflows, Says ETF Analyst
According to an exchange-traded fund (ETF) analyst, the recent notable outflows from Grayscale Bitcoin Trust (GBTC) are likely due to Genesis, a digital asset financial firm. The price of Bitcoin dropped below $64,000 on March 22, and it appears that Genesis is taking advantage of the dip by trading its GBTC shares.
Eric Balchunas, a senior ETF analyst at Bloomberg, noted that the nine new Bitcoin ETFs have seen inflows of around $1.2 billion over the past five days despite an 8% decline in price. He stated on social media platform X that GBTC had outflows but mostly from Genesis, who is exchanging GBTC shares for spot BTC. This means that it is a net neutral event since the ETFs have been net buyers of BTC, and more money has actually come in.
An X user also noticed that 16,800 BTC entered two of Genesis’s wallets, which may have come from GBTC outflows.
Record Outflow for GBTC
On March 18, GBTC experienced a record daily outflow of $642.5 million. Between March 18 and March 21, a total of $1.84 billion flowed out of GBTC, according to data from The Block’s Data Dashboard.
About Grayscale Bitcoin Trust (GBTC)
GBTC is a converted spot bitcoin ETF issued by Grayscale Investments, a digital asset management firm. It is one of the largest and most well-known investment vehicles for Bitcoin.
Hot Take: Genesis Behind GBTC Outflows, ETFs Still Bullish on BTC
The recent outflows from GBTC have raised questions about the motivations behind them. However, it seems that Genesis, a digital asset financial firm, is likely responsible for these outflows as it trades its GBTC shares for spot BTC.
Despite the outflows, the overall sentiment among ETFs remains bullish on Bitcoin. The nine new Bitcoin ETFs have seen significant inflows over the past five days, totaling around $1.2 billion. This suggests that investors are still confident in the long-term potential of Bitcoin and are taking advantage of the recent price dip.
Furthermore, the fact that Genesis is exchanging GBTC shares for spot BTC indicates that it believes in the value of Bitcoin and sees this as an opportunity to acquire more at a lower price. This aligns with the general sentiment among institutional investors who view dips in the market as buying opportunities.
While GBTC has experienced outflows recently, it’s important to note that this is mostly from Genesis and not from other ETFs. In fact, the ETFs have been net buyers of BTC, indicating their continued interest and confidence in the cryptocurrency.
Overall, the recent outflows from GBTC can be seen as a temporary event driven by specific factors rather than a reflection of broader market sentiment. The influx of new money into Bitcoin ETFs suggests that investors are still optimistic about the future of cryptocurrency and are willing to take advantage of market fluctuations.
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