JPMorgan Analysts Predict GBTC Sell-Off to Ease: Relief on the Horizon

JPMorgan analysts believe that the surge of individuals selling off their profits from Grayscale’s Bitcoin Trust (GBTC) may be coming to an end. This could potentially have a positive impact on the price of Bitcoin, which has been hovering around $40,778. Since converting to an ETF on January 11, Grayscale’s fund has been experiencing sell-offs, resulting in approximately $4.3 billion leaving the fund. JPMorgan suggests that this selling frenzy may be easing, alleviating some of the downward pressure on the value of Bitcoin.
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Now, let’s delve into the true implications of the GBTC profit-taking for individual investors.
According to JPMorgan’s analysis, the price of Bitcoin has declined by more than 20% and is currently sitting at $40,000 in the two weeks since the launch of spot Bitcoin exchange-traded funds (ETFs) in the United States. The bank asserts that buyers who purchased GBTC at a discount were capitalizing on their profits, which contributed significantly to the price drop. However, with much of the profit-taking now completed, the analysts suggest that the downward pressure on Bitcoin from this source may be subsiding.
However, BitMEX, a centralized exchange, reports that all ten approved spot Bitcoin ETFs witnessed a net outflow of $158 million, marking the largest outflow since their launch. Grayscale’s ETF experienced $429 million in outflows on the same day, which decreased to $394 million on January 25.
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Furthermore, the banking giant highlights that BlackRock and Fidelity, two new companies that have entered the spot Bitcoin ETF market, are now competitors for GBTC. Currently, BlackRock’s ETF has received $1.9 billion in investments, while Fidelity’s has received $1.8 billion. On January 24, CC15Capital reported that BlackRock’s ETF only received $66.2 million, the lowest amount since its inception. On the same day, Fidelity’s ETF added 3,170 Bitcoins, bringing its total holdings to 41,170.
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