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Bitcoin Slips to $64K as Large Grayscale GBTC Outflows Continue
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Bitcoin fell below $63,000 early during the U.S. session Friday amid a broader crypto sell-off.
“It will take some time” until bitcoin recovers to $73,000, Galaxy CEO Mike Novogratz said at the Bitcoin Investor Day in London
ETF inflows will return once GBTC selling is completed due to favorable macro conditions, Coinbase analysts said.
Volatility in crypto markets continued Friday, with bitcoin (BTC) tumbling below $63,000 at one point from the $67,000 area just hours earlier. A modest rebound since has taken the price back to the current $64,000, down 3.7% over the past 24 hours.
The sell-off rippled through the market, with the broad CoinDesk 20 Index was lower by 4.4% over the same time frame, led by layer-1 network Solana’s token (SOL) declining more than 10% at one point.
It’s been more than a week when BTC turned sharply lower from its fresh all-time high price over $73,000 and crypto assets entered a corrective period. While Wednesday’s steep, 10% rally on the back of a dovish Federal Reserve promised a quick recovery, the price action since suggests otherwise.
“[It] will take some time before we take out that $73,000 again,” said Mike Novogratz, CEO of digital asset investment company Galaxy Digital, during a panel discussion at Bitcoin Investor Day in New York Friday morning.
The weak price action comes as U.S.-listed spot bitcoin ETFs have suffered what’s now four consecutive days of net negative flows. To be sure, nearly all the funds continue to see inflows, but each day this week, they’ve not been nearly enough to offset massive outflows from the Grayscale Bitcoin Trust (GBTC). On Thursday, GBTC saw $359 million in outflows, leading to $94 million in outflows for the entire fund group. Fidelity’s Wise Origin Bitcoin Fund (FBTC) garnered the lowest daily inflow in its history, data compiled by BitMEX Research shows.
So far through the week, the spot ETFs have recorded over $830 million outflows, and are on track to endure their second negative week since late January when BTC corrected to $39,000.
Analysts at Coinbase Institutional noted that the increased GBTC selling is potentially in part due to Genesis selling shares as part of its bankruptcy process. Once the sales are completed, the report said, inflows to ETFs could pick up again amid favorable macro conditions and favorable central bank policy.
“We think the macro environment remains amenable for more spot bitcoin ETF inflows following the Federal Reserve meeting that concluded on March 20,” the Coinbase authors wrote. “We expect the current US disinflationary trend to remain intact, financial conditions in the US to continue easing, and markets to be supported by the tapering of the Fed’s quantitative tightening program.”
Helene Braun contributed reporting
