JPMorgan Analysts Suggest Grayscale’s Bitcoin Trust (GBTC) Profit-Taking is Waning, as U.S. Bitcoin Funds Experience Record Outflows

JPMorgan Analysts Suggest Grayscale’s Bitcoin Trust (GBTC) Profit-Taking is Waning, as U.S. Bitcoin Funds Experience Record Outflows

Crypto News – Analysts from JPMorgan believe that the majority of profit-taking activities related to Grayscale’s Bitcoin Trust (GBTC) are now likely over, potentially alleviating downward pressure on the price of Bitcoin. This assessment comes as United States spot Bitcoin exchange-traded funds (ETFs) recorded their largest daily net outflows on the ninth day of trading.

According to JPMorgan’s market strategy managing director, Nikolaos Panigirtzoglou, “GBTC profit-taking has largely happened already,” indicating that the primary downward pressure on Bitcoin stemming from this source may have subsided. Grayscale’s fund had been trading at a discount to its net asset value since early 2021, and the analysts attribute the $4.3 billion in outflows since its conversion to an ETF on January 11 to “profit-taking on previous GBTC investments,” which may have contributed to Bitcoin’s nearly 20% price decline, currently trading below $40,000, following the launch of multiple U.S. Bitcoin ETFs.

JPMorgan’s analysis follows significant net outflows of $158 million from the ten approved spot Bitcoin ETFs on January 24, marking the largest net outflow day since their launch, according to BitMEX research data. On January 24, Grayscale’s ETF experienced $429 million in outflows, with data for January 25 showing outflows decreasing to $394 million, the second-lowest outflow day on record.

Data compiled by X account CC15Capital for January 24 revealed that Bitcoin ETF holdings across all ten funds dropped by 4,610 BTC, valued at nearly $184 million on that day.

The JPMorgan analysts also noted that BlackRock and Fidelity‘s spot Bitcoin ETFs are emerging competitors to GBTC, with respective assets under management of $1.9 billion and $1.8 billion. On January 24, BlackRock’s ETF saw its lowest inflow since launch, with only $66.2 million on that day, while it increased its Bitcoin holdings by 1,663 BTC, totaling nearly 45,700 BTC. Fidelity’s ETF added 3,170 BTC on January 24, bringing its total holdings to 41,319 BTC.