A $640 million exit from the Grayscale exchange trade fund showed that investors are becoming concerned about Bitcoin’s valuation.
BTCUSD – Daily Chart
The price of BTC has cooled off from its recent highs above $70,000, and there is a risk of further lows below $60k, where $52,000 would be supported.
Losses came after the market saw a record daily outflow from Grayscale’s GBTC, the most significant spot exchange-traded fund (ETF). On Monday, Grayscale’s converted GBTC ETF saw outflows of $642.5 million, surpassing the previous record of $640.5 million set on January 22. Other ETFs saw some selling, such as Fidelity’s ETF, the second-largest fund, saw its inflows drop to only $5.9 million, the lowest since its inception, according to data.
That could indicate that the speculative rush into stock-market-listed Bitcoin assets could end. ETF trading volumes slowed to $4.2 billion on Monday, down from the previous week’s range of $5.5 billion to $7.7 billion and less than half of the record daily volume of $9.9 billion set on March 5.
BlackRock’s IBIT ETF continues to be the leader in trading volume, reaching $2 billion. Grayscale’s GBTC and Fidelity’s FBTC were followed by $1 billion and $630 million.
The market will now look to Wednesday’s Federal Reserve decision, which could pose a risk to speculative assets. A more hawkish message from the central bank could hurt investors’ risk appetite and lead to a more extensive correction in BTC.
The next big event for Bitcoin will be April’s “halving,” which will cut mining rewards by half. To cope with lower incomes, Bitcoin miners are upgrading to more efficient mining machines, cutting costs and using cheaper power sources.
