Bitcoin price loses steam after the spot Bitcoin ETFs’ approval and listing on exchanges, falling over 15% from $48,969 to $40,297. In a paradigm shift, trading volumes dropped significantly on crypto exchanges..
Moreover, there’s a narrative in the market over Grayscale Bitcoin Trust (GBTC) selling Bitcoin holdings, but CryptoQuant team asserts it’s not actually the case. They also predict a short-term correction.
CryptoQuant head of research Julio Moreno, said it’s a wrong narrative circulating in the market that the current Bitcoin price correction is due to GBTC selling Bitcoin holdings.
Grayscale Bitcoin Trust (GBTC) sold about 60K bitcoins, but other 10 spot Bitcoin ETFs such as BlackRock, Fidelity, Bitwise have a combined net purchase of about 72K bitcoins. It indicates that the inflow is indeed increasing, with trading volumes exceeding billions.
The Bitcoin selloff has come from holders including short-term traders and whales. They capitalized on the “sell-the-news” event to book profit of the recent rally.
“Several On-chain metrics and indicators still suggest the price correction may not be over or at least that a new rally is still not on the cards. Short-term traders and large Bitcoin holders are still doing significant selling in the context of a risk-off attitude. Additionally, unrealized profit margins have not fallen enough for sellers to be exhausted,” as per CryptoQuant insights.
Popular analyst CredibleCrypto noted that definitive data is proving that ETF flows are net positive at +5,000 Bitcoin bought per day since launch, which is 10 times the effect of the upcoming halving. However, recent “PA doesn’t seem to reflect that. This literally proves that there are other, more significant factors at play that have a greater influence on PA in the short/mid term.”
Read More: Spot Bitcoin ETFs See Inflows of $33.1 Million on Day 6
CryptoQuant founder and CEO Ki Young Ju in a post on January 20 revealed that Bitcoin in distribution phase is not fully distributed to retailers. He warns about a short-term correction in BTC price, after a 15% correction in the last few days.
However, he added that this long-term bull market cycle will continue until Bitcoin is fully distributed to retailers. The long-term outlook remains positive.
BTC price jumped 1% in the past 24 hours, with the price currently trading at $41,659. The 24-hour low and high are $40,297 and $42,134, respectively. Furthermore, the trading volume has decreased by 16% in the last 24 hours, indicating a decline in interest among traders.
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