JPMorgan Analysts Predict Easing Pressure on Bitcoin After Profit-Taking in GBTC
Summary:
JPMorgan analysts predict that most profit-taking from the Grayscale Bitcoin Trust (GBTC) has already occurred, potentially lifting some burden off Bitcoin's price. Bitcoin exchange-traded funds (ETFs) in the U.S. have seen record high outflows recently, contributing to a nearly 20% fall in Bitcoin's value. The largest net outflow day since their launch was January 24, with BlackRock's spot Bitcoin ETF inflows hitting a record low. Despite these conditions, BlackRock expanded its Bitcoin holdings and maintains over $1.8 billion in managed assets.
Analysts at JPMorgan speculate that the lion's share of profit-taking relating to the Grayscale Bitcoin Trust (GBTC) has likely concluded, which could alleviate downward force on Bitcoin's (BTC) value. This theory follows an all-time-high in daily net outflows from US Bitcoin exchange-traded funds (ETFs). The market report released on January 25, led by Managing Director of Market Strategy, Nikolaos Panigirtzoglou, conjectured that the majority of downward pressure on Bitcoin should now be in the rear-view thanks to profit-taking from GBTC investments.
Throughout 2021, Grayscale's fund has consistently been undervalued compared to its net asset value. Analysts attribute this, along with the $4.3 billion outflows following its ETF conversion on January 11, as reasons for the near 20% drop in Bitcoin's price, which now sits below $40,000. This market evolution transpired in the wake of numerous US Bitcoin ETF launches.
The ten authorized spot Bitcoin ETFs witnessed a net outflow of $158 million on January 24, marking the greatest net outflow day since launch, according to BitMEX research data posted on a social media platform on January 25.
On January 24, Grayscale's ETF experienced $429 million in outflows. The most recent data posted by BitMEX on January 25 shows this number declined to $394 million, marking the second-lowest outflow day on record.
As per data assembled for January 24, Bitcoin ETF holdings by all ten funds fell on that day by 4,610 BTC, valued at nearly $184 million.
Regarding BlackRock’s spot Bitcoin ETF, inflows on January 24 hit a record low since launch with just $66.2 million that day. Nonetheless, BlackRock managed to expand its Bitcoin holdings by 1,663 BTC. In total, BlackRock's IBIT currently contains roughly 45,700 BTC and maintains over $1.8 billion in managed assets.
Published At
1/26/2024 5:41:10 AM
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