Bitcoin goes down amid the sell-off of Grayscale Bitcoin Trust ETF (GBTC) assets, the volume of which fell by $2.8 billion in the first six days of trading. BTC is also under pressure from the rising performance of the U.S. economy.
Eric Balchunas, Analyst at Bloomberg, reported that assets under management of nine spot Bitcoin ETFs grew to nearly 95,300 BTC (~$3.96 billion) since launch. The sell-off of GBTC’s assets under management continues, with their volume declining by about $2.8 billion over the same period, while about 552,000 BTC (~$22.9 billion) remains under management of the Grayscale fund.
The sell-off of assets of the largest spot Bitcoin ETF puts strong pressure on Bitcoin’s price. BTC hit the $40,000 mark twice in the last few days. Experts predict that a further fall in the value is possible.
Analysts at Rekt Capital noted that Bitcoin’s price dropped to the minimum of the weekly range, a sign of a bearish trend. Meanwhile, Joe McCann, Founder of Asymmetric, stated a substantial decline in Bitcoin’s trading volume. Crypto Tony, On-Chain Analyst, suggested that BTC quotes may fall to the level of $38,000 before the halving occurs.
One more factor that puts pressure on the quotes is the growth of certain economic indicators in the United States. The U.S. Dollar Index (DXY), which tracks the dynamics of the dollar against a basket of leading foreign currencies, showed at peak moments an increase of 2.71% compared to the local minimum recorded on December 27 last year. The growth of the indicator comes amid an increase in the level of retail sales in the U.S. in December 2023 and the recovery of U.S. bond yields. Given these dynamics, the Fed may start lowering interest rates in March, thus reducing demand for high-risk assets.
Amid expectations of the launch of spot Bitcoin ETFs, BTC rose above the $47,000 mark, and the Fear and Greed Index went into the “extreme greed” zone. However, soon after the launch of investment instruments, the hype around them began to subside, and Bitcoin began to fall.
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