Both Bitcoin (BTC) and Ethereum (ETH) see aggregated network fees declining due to shrinking volatility. While Bitcoins (BTC) still flow to exchanges, Ethereum (ETH) reserves started leaving CEXes. Is the crypto correction close to ending?
Bitcoin (BTC) price tanks on GBTC FUD and institutions taking profit, IntoTheBlock says
The price correction of Bitcoin (BTC), the largest cryptocurrency, is caused by the FUD about Grayscale's mass-selling and profit-taking initiated by largest players. Such statements were made by top research platform IntoTheBlock in its recent on-chain insights report.
Based on its tracking mechanisms, IntoTheBlock confirmed a $4.3 billion outflow from Grayscale Bitcoin Trust (GBTC). Technically, Grayscale's GBTC, which had been at a discount relative to the firm's Bitcoin (BTC) holdings for two years, was converted into an ETF. This caused whopping outflows that contributed to the BTC price tumbling.
Even being accompanied by a $1 billion outflow from the FTX holdings portfolio, this catalyst should not be overestimated. Despite these negative processes, Bitcoin ETFs registered a significant $820 million net inflow, which hints at solid interest from large buyers.
The addresses holding over 1,000 BTC each are buying en masse, data says. They were increasing their holdings through the entire year of 2023, but in January this process accelerated.
At the same time, large hedge funds decided to take profits, which is also a major bearish price catalyst. Their activity pushed the price to new local highs in Q4, 2023, but now the situation looks the opposite:
As the ETF approval window began we see that premium in futures quickly turning into a discount suggesting firms began taking profits
By printing time, Bitcoin (BTC) is changing hands at $41,715; the largest cryptocurrency recovered almost 4% in the last 24 hours.
BTC price's negative catalysts losing steam?
However, in the last days, some positive news for Bitcoin (BTC) arrived. IntoTheBlock says GBTC outflows have also slowed down in the last two days.
Also, China's central bank announced its readiness to inject $140 billion into its financial system, which might be another catalyst for the crypto capitalization surge.
Vladislav SopovAs covered by U.Today yesterday, digital assets expert Ilan Solot from Marex Solutions said that "the worst was over" for crypto as the GBTC bearish narrative failed to push the Bitcoin (BTC) price lower.
Arman Shirinyan
Tomiwabold Olajide
Dan Burgin
U.Today Editorial Team