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Grayscale’s GBTC Bitcoin Holdings Predicted to Run Out in 96 Days
Blockchain analytics company Arkham has made a prediction that Grayscale’s GBTC product will exhaust all its Bitcoin holdings in 96 days, based on the current rate of redemptions.
Current Status of GBTC Holdings
Since GBTC began trading as an ETF on January 11th, Grayscale has moved 266.47K BTC out of their wallets for GBTC redemptions, averaging at 25.9K BTC per week.
Decrease in Bitcoin Holdings
At the beginning of the year, Grayscale held 618.28K BTC for their Bitcoin Trust GBTC. Now, they only have 356.44K BTC remaining, according to Arkham’s estimates.
If the current trend continues, it is projected that Grayscale will deplete its Bitcoin holdings in 14 weeks.
Reasons for Decrease in Holdings
Grayscale, the largest crypto asset manager globally, has witnessed a significant reduction in its Bitcoin holdings post the conversion of its bitcoin fund into an ETF in mid-January.
One of the contributing factors to the outflow is the higher fees associated with GBTC compared to ETFs offered by Blackrock and Fidelity.
Introduction of ‘Mini’ BTC ETF
To address the excessive outflows, Grayscale has introduced a ‘mini’ BTC ETF to offset losses for existing GBTC holders and investors.
Theories Behind GBTC’s Outflows
Bloomberg ETF analyst Eric Balchuna speculates that the recent increase in outflows from GBTC could be linked to recent bankruptcies and their impact on the market.
He believes that once the worst is over, only retail investors will remain, leading to a change in the pattern of outflows.
