JPMorgan reports GBTC sell declining, highlights ETF record outflows

Analysts at JPMorgan have indicated a potential easing in the selling pressure on Bitcoin, as the bulk of profit-taking from the Grayscale Bitcoin Trust (GBTC) appears to be concluding.

In a market report released on Jan. 25, a team led by Nikolaos Panigirtzoglou, JPMorgan’s market strategy managing director,”GBTC profit taking has largely happened already.” The assessment suggests that the primary factors influencing Bitcoin’s price fluctuations, specifically those linked to GBTC, might be diminishing.

Grayscale’s fund has been trading below its net asset value since early 2021. Analysts attribute the $4.3 billion in outflows since its Jan. 11 conversion to an ETF to investors cashing in on earlier GBTC investments. This is seen as a key factor in Bitcoin’s near 20% price fall, with its value now below $40,000, coinciding with the introduction of several US Bitcoin ETFs.

Notably, on Jan. 24, these funds experienced a record high in daily net outflows, reaching $158 million, as reported by BitMEX research data. This was the highest single-day net outflow since these ETFs began trading.

On Jan. 24, Grayscale’s ETF experienced outflows amounting to $429 million. Following this, BitMEX data revealed a decrease in outflows to $394 million on Jan. 25, marking this as the second smallest outflow day for the fund on record.

Data compiled by CC15Capital for Jan. 24 highlighted a significant reduction in Bitcoin holdings across all ten spot Bitcoin ETFs, totaling a loss of 4,610 BTC, valued at nearly $184 million.

Amidst these developments, JPMorgan analysts have identified BlackRock and Fidelity’s spot Bitcoin ETFs as emerging competitors to GBTC in the space. These funds have rapidly amassed considerable assets under management, with BlackRock and Fidelity’s respective totals standing at $1.9 billion and $1.8 billion.

On Jan. 24, BlackRock’s ETF witnessed its lowest inflow since inception, adding only 1,663 BTC to its holdings, which now amount to approximately 45,700 BTC. In contrast, Fidelity’s ETF experienced an addition of 3,170 BTC, bringing its total holdings to 41,319 BTC.

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