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14 April 2024

The Grayscale Bitcoin Trust (GBTC) is experiencing a significant decline in capital outflows, signaling a potential end to selling pressure from this major Bitcoin investment fund.

Recent data indicates that GBTC outflows have reached a record low, dropping by nearly 90% compared to the previous day. This development has injected optimism into the market, particularly for Bitcoin’s price trajectory.

On April 10, GBTC witnessed a noteworthy decrease in outflows, plummeting from $154.9 million on April 9 to $17.5 million, according to Farside data.

This sharp decline coincided with a modest increase in Bitcoin’s price, which rose by over 2% and briefly surpassed the $70,000 mark, as reported by CoinMarketCap.

However, Bitcoin experienced a temporary dip to $67,842 following the release of higher-than-expected Consumer Price Index (CPI) figures for March, which stood at 3.5% year-on-year. Analysts speculate that this may delay any potential interest rate cuts by the US central bank.

Crypto experts are now cautiously optimistic about the decreasing outflows from GBTC, interpreting it as a possible indication that selling pressure from the fund is waning. Thomas Driver, head of the crypto portal Apollo, posed the question on X (formerly Twitter), highlighting the drastic reduction in outflows by nearly 95% compared to the beginning of the week.

Previously, GBTC recorded substantial outflows, with 4,288 Bitcoin or $303 million withdrawn as recently as April 8. However, the latest data marks a significant departure from this trend, with outflows hitting a new low.

Notably, the average outflow over the past four months has been $257.8 million, underscoring the significance of this recent decline.

Additionally, other Bitcoin investment vehicles have seen notable inflows during this period. The Fidelity Wise Origin Bitcoin Fund raised $76.3 million, BlackRock’s iShares Bitcoin Trust garnered $33.3 million, and the Bitwise Bitcoin ETF received $24.3 million, while the ARK 21Shares Bitcoin ETF attracted $7.3 million.

In parallel, insolvent crypto lender Genesis has sold approximately 36 million GBTC shares to acquire 32,041 Bitcoin.

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