Bitcoin (BTC) may be experiencing a shift in momentum as institutional outflows of BTC decrease. Recent data from various sources, including UK-based investment firm Farside, shows that the Grayscale Bitcoin Trust (GBTC) only lost $170 million on March 22. This suggests that BTC is consolidating its price before retesting its all-time high.
The US Spot Bitcoin exchange-traded funds (ETFs) have been receiving attention for the wrong reasons this week. Inflows have significantly declined since the beginning of March, while GBTC outflows reached record highs, resulting in five consecutive days of net reductions in assets under management. This timing appears to be intentional, as it is rumored that bankrupt crypto lender Genesis has been selling its GBTC position throughout the week.
If this selling pressure has indeed concluded, there could be a relief in downward pressure on ETF trends. Investor and entrepreneur Alistair Milne noted on X (formerly Twitter) that the net flows out of Bitcoin ETFs dropped to -$51.6 million, largely due to a slowdown in GBTC selling.
Statistician Willy Woo, creator of on-chain data resource Woobull, also supports this pivot point theory. In a recent X post, Woo introduced a new model that compares ETF inflows with BTC price action. While he did not provide specific information on the data used for this metric, he suggested that the most intense phase of offloading may be over.
Pseudonymous commentator WhalePanda agrees with this outlook. In his assessment of the week’s flows, he remains optimistic about BTC’s near-term price action and suggests that the conditions for a return to price discovery may be in place by next week.
However, some critics have been more skeptical of GBTC, which now holds only half of the assets under management it had when it converted to an ETF in January. Crypto author and educator Vijay Boyapati argues that the entire ecosystem will be much healthier when GBTC has zero assets under management.
Overall, spot Bitcoin products have seen the most successful ETF launch in history, with cumulative flows reaching $12.15 billion since they began trading. Cathie Wood, CEO of one of the ETF providers, ARK Invest, believes that the bulk of institutional exposure is still to come.
It is important to note that this article does not provide investment advice or recommendations. All investment and trading decisions involve risk, and readers should conduct their own research before making any decisions.