Spot Bitcoin ETF Approval Fails to Boost BTC Price
In a surprising turn of events, the recent approval of spot Bitcoin exchange-traded funds (ETFs) has not had the expected positive impact on the Bitcoin price. Contrary to expectations, BTC has experienced a sharp drop of over 16% since the ETF approval, falling below the $40,000 level. This failure to hold support has led to a testing phase at $38,000, accompanied by a 4.5% price drop in the past 24 hours.
Bitfinex Whales Accumulate Bitcoin Long Positions
Despite market volatility, Bitfinex whales have been accumulating Bitcoin long positions since November 2023. This marks the first sustained increase in Bitfinex BTC long positions after a decline last year.
The recent downturn in BTC can be partially attributed to increased selling pressure from miners and asset manager Grayscale. Grayscale has been selling off BTC since ETF trading began, including transferring a significant amount of BTC from its trust address to Coinbase.
Grayscale’s Sell-Off Impacts Liquidation Zones
The impact of Grayscale’s sell-off is evident in CoinGlass’ liquidation heatmap, which shows notable liquidation zones being wiped off in the 1-week chart. However, the increased accumulation of BTC long positions on Bitfinex suggests a potential change in sentiment. If the $38,000 support line holds, there could be a price reversal pushing BTC back above $40,000.
Institutional investors and asset managers involved in the ETF market have collectively acquired over 86,320 BTC at an average price of $42,000. This demonstrates growing recognition of Bitcoin as a legitimate asset class and confidence in its long-term growth potential.
Uncertainty Surrounds BTC Price Amidst Grayscale’s Sell-Off
Currently, the Bitcoin price is at $38,800, reflecting a year-to-date decline of over 12% and a 9.7% drop in the past seven days. The extent and duration of the selling pressure caused by Grayscale’s BTC sell-off remain uncertain, leaving the question of how much further the BTC price may decline.
Featured image from Shutterstock, chart from TradingView.com
Hot Take: Spot Bitcoin ETF Approval Fails to Boost BTC Price
The approval of spot Bitcoin exchange-traded funds (ETFs) was expected to have an immediate positive impact on the Bitcoin price. However, since the approval, BTC has experienced a significant drop instead. This unexpected outcome has raised concerns within the crypto community. While there are factors such as increased selling pressure from miners and asset manager Grayscale contributing to the decline, the accumulation of BTC long positions on Bitfinex suggests a potential change in sentiment. The future of the BTC price remains uncertain as investors closely monitor market dynamics and institutional investments.
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