- Grayscale’s total cumulative outflows were $14.15 million
- Coinbase analyst views GBTC sales linked to Gemini as “net neutral”
The new American spot Bitcoin [BTC] ETFs recorded net outflows last week. Grayscale’s GBTC led the outflow, totaling $2.1 billion.
As the first quarter of 2024 draws to a close, there has been renewed bullish interest over the past 48 hours. In fact, spot ETFs raised $15.4 million on March 25. Still, GBTC’s outflows unfortunately continued into the new week and amounted to $350.1 million.
Needless to say, this outflow has caused a lot of concern throughout the community. Coinbase analyst David Duong was quick to comment on whether GBTC outflows are impacting Bitcoin’s price action or not.
The outflow of BTC from GBTC continues
In a recent interview, Duong said cited the possibility of bankrupt Gemini paying back its customers using BTC from its GBTC share.
“Gemini’s majority stakes will be settled in Bitcoin. And if so, that means they are selling GBTC and buying Bitcoin.”
The assumption is that GBTC’s continued outflows are related to Gemini’s liquidations. As a result, Duong views GBTC’s current outflow as counterintuitive;
“So that means that the performance itself must be net neutral.”
To date, consistent GBTC outflows have reduced Grayscale’s holdings from 624.28k BTC to 357.05k BTC, according to Arkham Intelligence facts. That translates to a decline of 42.8% since the fund switched to an ETF in January.
Bloomberg’s Senior ETF Analyst Erick Balchunas also offered several theories about GBTC’s outflows. In one he stated:
“They probably underestimated how brutally competitive the US ETF market is.”
At the time of writing, Bitcoin was on track to break out of last week’s range, trading above $70,000. Referring to the prevailing price action, Duong added:
“We’re really in new territory for price discovery because we don’t know what the behavior will be.”
He further said:
“I think we will see continued upside potential.”
That said, Duong’s ‘net neutral’ thesis on GBTC sales can only be confirmed if Gemini customers receive refunds in BTC. In the meantime, GBTC outflows could increase as the halving beckons.