Most of the selling pressure on Bitcoin (BTC) from investors profiting from the Grayscale Bitcoin Trust (GBTC) appears to have ended, JPMorgan said on January 25. This was stated in the investigation report of the day.

The bank pointed out that Bitcoin fell more than 20% in the two weeks after the Bitcoin spot exchange-traded fund (ETF) was launched in the United States, and the profit-taking sell-off of GBTC by investors who bought it at a discount was an adjustment. He said this was the main factor.

Before its conversion into an ETF, GBTC was one of the few ways for American investors to gain exposure to Bitcoin without owning the underlying crypto asset. It is still the largest Bitcoin investment product with assets under management of over $20 billion (approximately 3 trillion yen, equivalent to 1 dollar = 150 yen).

JPMorgan previously estimated that there would be about $3 billion in outflows from GBTC due to profit taking from discount trading to estimated net asset value (NAV). These flows are important because as investors profit from these trades, capital flows out of the crypto market and puts downward pressure on Bitcoin’s price.

Analysts led by Nikolaos Panigirtzoglou said, “With $4.3 billion (approximately 645 billion yen) already outflowing from GBTC, profit taking in GBTC is almost over.” . “Most of the downward pressure on Bitcoin was due to that.”

The bank estimates that about $1.3 billion (approximately 195 billion yen) was moved from GBTC to the newly created spot Bitcoin ETF, which is undervalued. This equates to a monthly outflow of $3 billion. These outflows are likely to continue if Grayscale’s fee reductions do not proceed, and could even accelerate if other spot ETFs “reach a critical mass where they begin to compete with GBTC in terms of size and liquidity.” Yes,” the report added.

As reported by CoinDesk, the bankruptcy trustee of cryptocurrency exchange FTX has released approximately $1 billion worth of GBTC since its conversion to an ETF, resulting in selling pressure on BTC. Joined the.

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: Shutterstock
｜Original text: Grayscale’s GBTC Profit Taking Likely Over, Easing Bitcoin Selling Pressure: JPMorgan