Bitcoin (BTC) is experiencing a bearish trend, driven by the global impact of Grayscale (GBTC) investors liquidating their holdings. This sell-off has led to a significant drop in Bitcoin’s price, with investors redeeming their Grayscale trust shares and offloading BTC into the open market.
On Friday, Bitcoin’s price plummeted by 8%, triggering R2.379 billion (USD 130 million) in total liquidations. This included R2.065 billion (USD 112.84 million) in long positions and R321.53 million (USD 17.57 million) in shorts. The sell-off coincided with up to R21.777 billion (USD 1.19 billion) in open interest evaporating, as GBTC holders capitalized on the opportunity to withdraw from the R25 billion held in the Grayscale trust.
According to Bloomberg ETF analyst James Seyffart, while Grayscale GBTC experienced an outflow of R8.857 billion (USD 484 million), other ETF players like ARK Invest saw inflows of up to R777.75 million (USD 42.5 million). Notably, Grayscale’s movement of Bitcoin to Coinbase addresses indicates users are redeeming their holdings.
Peter Schiff, a well-known economist and strategist, predicts a challenging period ahead for BTC investors. He anticipates increased selling pressure, especially if the new Bitcoin ETFs open significantly lower on Monday. This forecast is particularly relevant for the South African crypto market, where Bitcoin is increasingly popular.
At the time of reporting, Bitcoin’s price stands at R781,611.3 (USD 42,711), with various indicators signaling a bearish trend as the weekend approaches. However, analysts believe the overall bullish sentiment for Bitcoin remains intact, at least until the price potentially drops to the critical R30,000 level.
For South African investors and enthusiasts in the cryptocurrency space, these developments highlight the volatility and global interconnectedness of the Bitcoin market. The situation underscores the need for vigilance and informed decision-making in the rapidly evolving digital currency landscape.
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