Bitcoin Dips Below $40,000: GBTC Sales & ETF Approval Fuel Market Downturn
Summary:
Bitcoin's price dropped below $40,000, the lowest since Dec. 3, 2023. This trend resulted from the ongoing GBTC-attached Bitcoin selling at Coinbase. Bitcoin's value sunk more than 4.3% in the previous 24 hours to a six-week low. The surprise approval of 11 spot Bitcoin ETF products by the Securities and Exchange Commission and subsequent GBTC selling were identified as catalysts for this market crash. Grayscale's Bitcoin deposit on Coinbase passed $600 million, with FTX's bankruptcy controllers selling all their GBTC shares, further exacerbating the downward trend.
Bitcoin's value unexpectedly dipped below the $40,000 mark, a level unseen since Dec. 3, 2023. This decline is associated with continued Bitcoin dumping by GBTC at Coinbase, which has had a detrimental knock-on effect on overall investor morale in the cryptocurrency landscape. Data from CoinMarketCap indicates that Bitcoin (BTC) nosedived from a $41,553 valuation on Jan. 22 with recent fall of 4.3% in 24 hours and 9.3% reduction over a month, bringing the price down to a six-week record low of $39,450.
The cited price slump comes off the back of the shocking decision by the Securities and Exchange Commission to greenlight 11 Bitcoin ETF commodities in the U.S., an outcome that implicated GBTC sales as the main culprit for the market destabilization. Adding to this, sheer outflows from crypto funds to the tune of $24.7M due to GBTC sales have further deflated Bitcoin's value.
On Jan. 22, Grayscale moved over $600 million worth of Bitcoin onto Coinbase, raising the total amount to more than $2 billion. Concurrently, FTX's bankruptcy administrators offloaded all 22 million of its GBTC shares - almost $1 billion equivalent, which has only added to the downward price pressure.
Recalling Dec. 3, 2023, Bitcoin experienced a dip to $39,293, not observing the $40,000 threshold for about six weeks. Afterward, it climbed to a nearly 20-month pinnacle of nearly $49,000 on Jan. 11. Seth, a trader and analyst, highlighted this dip below the $40,000 mark. He expressed his desire to see the principal cryptocurrency yield a "day's end above 40K!".
According to Coinglass, the collective long-position liquidations for Bitcoin crest at over $56 million for the day and is still adding up. Meanwhile, cross-crypto long liquidations reached just over $208.7 million. At the time this report was prepared, Bitcoin had somewhat reclaimed its value and was trading at $40,245.
This report does not endorse or provide personal investment advice or recommendations. Each investment move bears a level of risk, so readers are urged to independently investigate before deciding.
Published At
1/23/2024 12:09:53 AM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.