Bitcoin (BTC), the largest cryptocurrency globally, experiences significant selling pressure, marking a 3.45% decline on Thursday and slipping below the $41,000 mark. This downturn extends Bitcoin’s weekly losses to over 10%, with the current BTC price at $40,896 and a market cap of $805 billion.
What’s Behind the BTC Price Correction?
Ever since the launch of the spot Bitcoin ETFs last week, there have been massive outflows witnessed from the Grayscale Bitcoin Trust (GBTC). As a result, Grayscale has to liquidate a large number of Bitcoins as part of its GBTC holdings. A total of $2.2 billion has moved out of GBTC so far over the last week.
In a recent statement, renowned crypto analyst Scott Melker addressed concerns about Grayscale’s role in the market, emphasizing that the asset manager is not actively “dumping on the market.” Melker clarified that the selling of Grayscale’s Bitcoin Trust (GBTC) is initiated by individuals selling their GBTC holdings, prompting Grayscale to sell an equivalent amount of Bitcoin.
He highlighted that this process is not nefarious but rather a fundamental aspect of the mechanics associated with an Exchange-Traded Fund (ETF). Melker’s insights shed light on the dynamics at play and provide context to the market movements involving Grayscale and its Bitcoin holdings.
However, these developments have been leading to downward selling pressure on the BTC price in these days.
Bitcoin ETFs Show Healthy Development
Since their launch, the spot Bitcoin ETFs have witnessed a healthy uptick in trading volumes with inflows into multiple ETF offerings. The BlackRock spot Bitcoin ETF has clocked more than a billion in inflows within just four days of launch.
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