1.6 Billion Grayscale Sale Ahead – What Does It Mean for Bitcoin?

Price of Bitcoin Added this week, Affecting heights Not seen since the 2021 bull run. But will it last?

He has news. He came down A US bankruptcy judge has given permission for bankrupt crypto lender Genesis to sell $1.6 billion in shares of Grayscale Bitcoin Trust (GBTC). The idea is to repay creditors with cash after the lender goes bankrupt.

Just last month, pressure from grayscale A large amount of whipping For the custodian of crypto, Coinbase, It led to the fall in BTC price.

So it's only natural to think the same thing will happen again when the Genesis finally goes on sale.

Bloomberg Business Intelligence analyst James Seifert told Decrypt that “at least $1.4 billion in sales will come from the loss of GBTC and the situation with Gemini, probably more.” But we don't know how much it sold for.

First, some background: Genesis is a subsidiary of the Digital Currency Group (DCG) that allows people to stake an interest in their crypto.

He presented A year ago, it shows vulnerability to loss He fell crypto venture fund Three Arrows Capital. After the crypto megabrand FTX is broken. In 2022, Genesis finally He froze Customer withdrawal.

Lenders are still waiting for the cash they have locked up in the product, and DCG says lenders will be made whole. A plan approved by a judge this week would allow him to repay creditors.

Experts do not think that the price of Bitcoin will be hit as hard, however.

“I personally don't expect to buy. [iBitcoin Trust shares] But at the same time, if you'd asked me a few weeks ago, I wouldn't have expected the flows to be as strong as they have been for the rest of the year,” Seifert said. “It's anyone's guess, but the entire group of Bitcoin ETFs — namely the newborn nine — has had a very successful first month.”

Eric Balchunas, an ETF expert at Bloomberg, told Decrypt that although the Genesis selloff may have had a negative impact, ETFs have “shown some real strength” that could prevent a large BTC selloff.

After ten years of denying the position of Bitcoin ETFs, the Securities and Exchange Commission in January approved 10 products. They started business on January 11 and a A roaring successcollecting billions in assets under management.

“The level of liquidity and resilience we've seen in Bitcoin in recent weeks is a testament to the strong demand in the market,” said Miguel Morel, CEO of blockchain intelligence firm Arcam Intelligence.

I didn't expect it, he added. [the Genesis news] To more impact than we've seen before.

Finally, Julio Moreno – head of research at chain and market data analysis firm CryptoQuant – agreed that “high demand for Bitcoin from Bitcoin ETFs” is more than enough to mitigate any downward pressure.

“It could bear on the price on the margin – we actually saw the price drop by 5% the day FTX sold $1 billion worth of GBTC shares,” Moreno told Decrypt. “However, the impact may be limited. [that] The market is expecting this sale. “

CryptoQuant data also shows againLow unrealized gains for short-term bitcoin holders, which could also mean lower selling pressure, he added.

Edited by Ryan Ozawa.