Following the approval of Bitcoin Spot ETFs, many analysts believe that the current downturn is a classic case of a “sell the news” scenario.
Today, the price of BTC experienced a sharp decline of nearly 10%, plummeting to $41,500. Simultaneously, a substantial amount of liquidation activity has inundated the cryptocurrency market over the past hour. A staggering $93 million in liquidation occurred within this timeframe, with $86.81 million resulting from long positions and $6.55 million from short positions.
According to Anthony Scaramucci, the founder of SkyBridge Capital, the recent slump in Bitcoin’s value can be partially attributed to the sale of shares in the Grayscale Bitcoin Trust.
During an interview with Bloomberg, Scaramucci highlighted significant selling activity involving Grayscale. He elucidated that his trading desk had observed shareholders shifting away from the trust this week, following the approval of Bitcoin ETFs by the U.S. Securities and Exchange Commission. Investors were selling their shares to realize losses and migrating towards alternative options with lower fees.
However, Zach Pandl, the General Manager of Research at Grayscale, has countered this argument by asserting that the act of selling one Bitcoin product to purchase another should not have a significant impact on Bitcoin’s overall price. He pointed out that the potential approval of spot Bitcoin ETFs has been a topic of discussion since Grayscale’s legal victory last summer.
Pandl also emphasized that, given the substantial surge in Bitcoin’s value, it is only natural for some investors to take profits by selling the asset. Notably, GBTC recorded a remarkable $2.3 billion in trading volume on Thursday, marking the highest first-day turnover ever for an ETF.
On the same day, Bitcoin soared to over $49,000, reaching its highest point in two years before retracing to $41,500 on Friday.
Additionally, Scaramucci disclosed that FTX’s bankruptcy estate has been actively selling assets into the market following the ETF announcement. He stated, “There is currently a significant selling volume in Bitcoin, but I anticipate that the oversupply will stabilize within the next six to eight trading days.”
Furthermore, he noted that this period represents a relatively quiet phase for Wall Street, with the marketing of these ETFs set to commence in approximately eight days.
*Please note that this content is not intended as investment advice.
Source: en.bitcoinsistemi
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