According to data provided by Arkham Intelligence, a blockchain analytics platform, on January 16, the Grayscale Bitcoin Trust (GBTC) transferred 8,730 Bitcoin to Coinbase Prime deposit addresses for a total value exceeding $376 million.
As its share price declined, the transfers suggest that the fund might have been compelled to divest a portion of its Bitcoin holdings.
Certain analysts have posited that the withdrawals from the trust are exerting pressure on the price of Bitcoin and are contributing, at least in part, to its recent decline. The price of Bitcoin seems to have stabilized amidst the outflows that occurred during midday trading hours in the United States on January 16.
The Grayscale Bitcoin Trust is among the world’s greatest individual BTC holders. Before January 11, the majority of fund investors were unable to exchange their shares for Bitcoin or cash equivalents. However, the trust transformed on January 11th, becoming an exchange-traded fund (ETF).
Subsequent to that period, authorized participants have been granted the ability to purchase shares from investors and exchange them for the monetary equivalent of the Bitcoin that each share signifies.
This necessitates the sale of Bitcoin by the trust for the purpose of compensating the recipients. When the price of GBTC is below the value of the BTC it represents when this process typically occurs.
Arkham data indicates that the trust transferred $41 million to a Coinbase Prime wallet on January 12, suggesting that the trust might have engaged in the sale of Bitcoin. Some traders hypothesized at the time that this outflow might have contributed to the precipitous decline in Bitcoin’s price that day.
Additionally, on January 12, Bloomberg analyst Eric Balchunas reported to X (previously Twitter) that the Grayscale Bitcoin Trust encountered outflows amounting to $95.1 million on January 11 and $484.1 million as of the close of trading on January 12. Balchunas cited Bloomberg Terminal as a source.
Additionally, other Bitcoin ETFs, including the Fidelity Wise Origin Bitcoin Fund and iShares Bitcoin Trust, reportedly received inflows of approximately $1.4 billion during these two days, according to Balchunas.
Considering the outflows of GBTC, this indicates that the U.S. spot Bitcoin ETF market witnessed net inflows exceeding $818 million during the initial two days of trading, notwithstanding the declines observed in the wider Bitcoin market during the same time frame.
As of 7:17 pm UTC on January 16, Arkham data revealed additional outflows of $376 million BTC from the Grayscale Bitcoin Trust. At 9:00 pm UTC, the U.S. equity market comes to a close.
Some merchants attribute the outflows to the increased GBTC fees. Critics assert that GBTC’s administration fee of 1.5% is greater than that of the majority of its rivals.
