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Grayscale Bitcoin Trust Records Positive Inflows After Months of Outflows
Grayscale Investments’ Grayscale Bitcoin Trust (GBTC) has experienced a significant shift in its inflows, recording its first day of net positive inflows in nearly four months. This comes after a continuous period of outflows following its conversion to a Bitcoin exchange-traded fund (ETF) in January.
Inflows and Outflows
On May 3, Grayscale’s GBTC recorded $63 million in inflows, marking a notable turnaround after experiencing approximately $17.5 billion of outflows since the approval of 11 spot Bitcoin ETFs on Jan. 11. This positive trend was also observed in other funds, with Franklin Templeton’s Bitcoin ETF (EZBC) seeing its highest ever inflow of $60.9 million. Fidelity Wise Origin Bitcoin Fund (FBTC) led the day’s inflows with $102.6 million, followed by Bitwise Bitcoin Fund (BITB) with $33.5 million and Invesco Galaxy Bitcoin ETF (BTCO) with $33.2 million.
Market Speculation
The crypto community has been actively speculating on the potential impact of these inflows, particularly on GBTC and Bitcoin’s price. Pseudonymous crypto investor DivXman highlighted the significance of the shift, suggesting a decrease in sell pressure and an increase in demand. Meanwhile, crypto trader Jelle predicted new all-time highs for Bitcoin, emphasizing the impact of the inflows on the market.
Bitcoin’s Price Response
Bitcoin’s price has responded to these developments, experiencing a 4.91% increase over the past 24 hours to reach $62,712 at the time of publication, according to CoinMarketCap data. This response indicates the market’s sensitivity to both outflows and inflows within the cryptocurrency space.
Factors Contributing to Outflows
Several factors have contributed to Grayscale’s ongoing outflows, including GBTC’s comparatively high fees in comparison to other available ETFs. GBTC’s fee is set at 1.5%, while other ETFs offer lower fees, with Franklin Templeton currently having the lowest at 0.19%. Additionally, bankrupt crypto firms FTX and Genesis have been selling off large amounts of GBTC shares to settle debts with creditors, further impacting the fund’s outflows.
Conclusion
The recent shift in inflows for Grayscale’s GBTC and other Bitcoin funds has sparked market speculation and impacted Bitcoin’s price. This development highlights the dynamic nature of the cryptocurrency market and the influence of various factors on investment flows and market sentiment.
📎 Read the original article on cointelegraph.com
