- Grayscale sold above 60,000 BTC while other Bitcoin ETF issuers have purchased over 72,000 BTC.
- Grayscale’s Bitcoin sale is unlikely to have driven the BTC price lower.
- Profit-taking by large wallet investors and traders is likely the catalyst for the increasing selling pressure and BTC price drop.
Grayscale, one of the largest crypto asset management firms and one of the issuers of the Bitcoin Spot ETFs, sold 60,000 BTC. While it may seem obvious that Grayscale’s Bitcoin sale likely increased the selling pressure on BTC, experts have presented an alternative view. It is likely that profit-taking activities by large wallet investors drove BTC price lower.
Also read: Dogecoin volume and social dominance hits 2024 peak as X launches dedicated payments account
This factor influenced Bitcoin price in the aftermath of ETF approval
According to a CryptoQuant expert, Julio Moreno, Bitcoin price correction is likely due to the profit-taking activities of traders, rather than Grayscale’s BTC sale. The expert addresses the narrative circulating on crypto Twitter and notes that the correction in Bitcoin price is likely on a decline due to the sale of BTC by Bitcoin holders.
The profit-taking spikes coincided with the large volume transactions valued at $100,000 and higher.
 [17.40.35, 21 Jan, 2024]-638414373195136883.png)
Bitcoin network realized profit/ loss and whale transactions. Source: Santiment
Between January 7 and 21, BTC on exchanges climbed from 5.34% to 5.40%. The rising supply on exchanges is typically considered as a factor that drives asset prices lower.
 [18.01.45, 21 Jan, 2024]-638414373531790188.png)
Bitcoin supply on exchanges and price. Source: Santiment
The expert dismissed the narrative that Grayscale’s Bitcoin sale is driving down prices, explaining that while Grayscale sold 60,000 BTC, other issuers acquired nearly 72,000 BTC. This is likely to have tackled the selling pressure from the former’s sale. Demand for the asset has likely increased with institutions lining up to acquire BTC, post SEC’s ETF approval.
At the time of writing, Bitcoin price is $41,739 on Binance.
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