Grayscale's Spot Bitcoin (BTC) Exchange Traded Fund (ETF)'s discount rate narrowed to its lowest level in nearly three years, causing investors to rush out of the fund over the past three days. The transaction took an estimated $1.1 billion out of the fund.
There was an estimated outflow of $594 million on the third day of trading on January 16th alone. according to Posted by Bloomberg ETF analyst James Seifert on X (formerly Twitter).
Seifert observed inflows from other recently launched Bitcoin ETFs, but was unsure whether those inflows exceeded Grayscale Bitcoin Trust (GBTC) outflows on January 16th. .
“Most other companies have seen inflows, but we doubt it will be enough to offset nearly $600 million from $GBTC.”
Today is likely to be a net outflow day. #bitcoin ETF.The remainder is estimated at approximately $594 million. $GBTC The total outflow was $1.173 billion. Most other companies have seen inflows, but it's unlikely to be enough to offset the nearly $600 million in funding. $GBTC https://t.co/elD9qkyjj2
— James Seyffert (@JSeyff) January 17, 2024
Seifert and other analysts I got it. The accounting and settlement processes that typically accompany trading stocks can result in discrepancies when calculating flows.
For years, GBTC has offered lucrative trades to investors who borrow money to participate in the fund and scalp profits at the grayscale premium, which reached 43% in July 2019. according to Go to YCharts data.
GBTC arbitrage disappeared in February 2021 when premiums suddenly became discounted.Due to a minimum lock-up period of 6 months imposed As investors bought GBTC stock, many investors became trapped in the fund and were unwilling to sell their shares at continually worsening discounts.
Following GBTC's conversion into a spot ETF, the discount has fallen to 1.55% and investors who had their funds locked up for a long time now face an exit.
The estimated $1.17 billion GBTC outflow is equivalent to about 27,000 Bitcoins at a current price of about $42,800.
Apart from GBTC, nine other Spot Bitcoin ETF issuers hold 35,761 Bitcoins. according to To X account CC15Capital.
In addition to Grayscale's 605,891 Bitcoins, BlackRock and Fidelity ETFs have a total of 11,439 Bitcoins and 9,750 Bitcoins, according to data from CC15 Capital.
However, each ETF issuer's Bitcoin holdings may not be up-to-date.
1/16 Bitcoin ETF Activity Update 1 $BITB Posted first update, increased by 1,172 #bitcoin https://t.co/9wqUajgDUm pic.twitter.com/t2BexSY8qQ
— CC15 Capital (@Capital15C) January 17, 2024
Related: Coinbase, Bitcoin price shows strength at $43,000 despite GBTC selling
Meanwhile, Cathie Wood's ARK Invest has begun accumulating its own recently approved ARK 21Shares Bitcoin ETF (ARKB), with shares in the ProShares Bitcoin Strategy ETF (BITO) and ARK Next Generation. Sold other technology-focused stocks in Internet ETFs.
ARK begins purchasing its own Bitcoin ETF…
It was only a matter of time. https://t.co/Z8P4nMGBNO
— Nate Geraci (@NateGeraci) January 17, 2024
ARKB currently holds 2,535 Bitcoins worth over $109 million, making it the fifth largest Bitcoin stack among the 10 spot Bitcoin ETF issuers.
magazine: The Wolf of All Street is concerned about a world where Bitcoin reaches $1 million: Hall of Fire
