Grayscale Bitcoin Trust (GBTC) moved over 19,000 BTC from publicly known wallets on the morning of the 14th. According to data compiled by Arkham, Grayscale has moved nearly 113,000 BTC from wallets since its Bitcoin spot exchange-traded fund (ETF) began trading on January 11, an overwhelming amount. The majority of the funds have been moved to Coinbase Prime in preparation for sale.

Not all leaks are redemption.

As of the morning of the 14th, Grayscale’s website shows GBTC holding approximately 537,000 BTC, a decrease of approximately 100,000 BTC since January 11.

As Arkham pointed out, it’s important to note that not all of the observed Bitcoin outflows from Grayscale wallets are related to redemptions. “Exfiltration is typically split between Coinbase Prime and the new GBTC custodian address,” Arkham noted. “This means that not all of the Bitcoins moved have been redeemed. The outflow appears to be a settlement of the previous day’s trading activity.”

There are various reasons for this huge outflow in GBTC, but the main reason is that Grayscale lowered its management fee by 50 basis points to 1.50% in conjunction with its conversion to a physical ETF. This is more than 100 basis points higher than nine other competing Bitcoin ETFs. Grayscale’s assets under management fell by more than $1 billion per day this week.

GBTC sale pushes down Bitcoin price

The fast pace of GBTC’s Bitcoin sales is one of the factors putting pressure on the Bitcoin price. This week, the Bitcoin price fell below $40,000 (approximately 6 million yen, equivalent to 150 yen to the dollar), the lowest price in about two months. At the time of writing, Bitcoin was valued at $39,800 and had remained roughly flat over the past 24 hours.

Bitcoin bulls’ hopes were briefly boosted this week by CoinDesk’s report on the 22nd that the bankruptcy estate of the failed cryptocurrency exchange FTX has released 22 million units of GBTC held by it. With the non-economic whale sellers gone, bulls were hoping that outflows from GBTC might slow. However, this is not the case at the moment, as evidenced by the movement of 19,000 BTC to exchanges this morning.

｜Translation and editing: Rinan Hayashi
｜Image: Wesley Tingey/Unsplash, modified by Speaking of Bitcoin
｜Original text: Grayscale’s GBTC Has Moved More Than 100K BTC to Exchange Since Spot Bitcoin ETF Launch