Bitcoin rides new $600M GBTC offload, with BTC price eyeing 2-month low

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Bitcoin (BTC) hit its lowest levels since the start of December after the Jan. 23 Wall Street open as anger grew over market selling.

BTC/USD 1-day chart. Source: TradingView

FTX gets heat as Bitcoin dives

Data from Cointelegraph Markets Pro and TradingView followed BTC price action as it slumped to $38,505 on Bitstamp.

Barely recovered at the time of writing, Bitcoin faced a now-familiar cocktail of institutional sell-offs and low demand to retrace nearly two months’ gains.

Attention focused on the Grayscale Bitcoin Trust (GBTC), a giant investment vehicle still with more than $20 billion in assets under management despite billions of dollars of Bitcoin offloaded this month.

Jan. 23 saw approximately another 15,200 BTC ($590 million) transferred from known GBTC holdings to custodian Coinbase, per data from crypto intelligence firm Arkham.

This was slightly less than the day prior, but with the final figures not yet confirmed, commentators remained skeptical.

“Decrease from yesterday at the very least,” popular trader Daan Crypto Trades wrote in part of a reaction on X (formerly Twitter).

“Yesterday’s net flows on all ETFs were slightly negative so the other ETFs doing a decent job absorbing still.”

Daan Crypto Trades referenced the performance of the United States’ new spot Bitcoin exchange-traded funds (ETFs), inflows to which were going some way to counteract the GBTC exits.

Others blamed not GBTC operator Grayscale but forced liquidations, as well as offloading by defunct exchange FTX, which prior to its own demise had considerable GBTC holdings.

“Recall selling GBTC for BTC, does NOT push bitcoin price down; selling for USD and keeping it in USD does,” Adam Back, CEO of Bitcoin technology firm Blockstream, explained.

“People doing USD selling are forced liquidations, bankrutpcy sales like FTX. so i’m not sure if there’s much USD net-selling left post FTX $1bil bankruptcy sale.”

Will Bitcoin ETF “sell the news” reaction soon fade?

On the topic of spot liquidations, BTC longs faced another day of pain.

Related: Spot Bitcoin ETFs’ on-chain addresses found by Arkham

Total longs wiped out during the two days through Jan. 23 stood at $110 million at the time of writing, according to the latest data from statistics resource CoinGlass.

BTC liquidations (screenshot). Source: CoinGlass

Optimists thus chose to take a longer-term view, arguing that current downside sources would not be able to keep up pressure on the market indefinitely.

Eric Balchunas, a dedicated ETF analyst at Bloomberg Intelligence, meanwhile, saw reason to celebrate Bitcoin’s 2023 performance.

In the past 12 months, BTC/USD has offered 75% returns — vastly outperforming popular investments such as stocks.

“How spoiled can you be that you living in angst right now? You will be in permanent state of misery if you don’t get perspective,” he wrote in part of X comments.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.