GBTC Sees $643M Outflow in a Day as Bitcoin Price Drops Below $65K

Grayscale’s spot Bitcoin exchange-traded fund (ETF), GBTC, has seen the biggest outflow on March 18 as Bitcoin price continues to drop.

As per BitMEX Research, a total amount of $643 million exited Grayscale Bitcoin ETF on the day. Bloomberg Intelligence ETF analyst Eric Balchunas stated that it is the “biggest outflow for GBTC thus far.”

Thanks to the massive GBTC outflow, the total spot Bitcoin ETF net flow for the day came around at negative $154.4 million.

We've got a negative flow day for the Cointucky Derby #Bitcoin ETFs thanks to $GBTC's $643 million outflow day pic.twitter.com/scmVgmwtiH

— James Seyffart (@JSeyff) March 19, 2024

GBTC’s Tremendous Outflows Continue

The Grayscale Bitcoin Trust has experienced significant outflows, with Bloomberg data indicating $7.4 billion exiting over its first 31 trading days. This trend contrasts sharply with other recently launched spot Bitcoin ETFs, which have seen net inflows.

One reason for GBTC’s notable outflows could be its higher management fee of 1.5%, compared to competitors charging less than 0.3%.

Additionally, entities like Genesis Global Holdco LLC, amidst bankruptcy, have been selling off their GBTC holdings.

Despite expectations of outflows during the fund’s potential conversion, the duration and consistency have caught observers off guard.

Though the ourflow of Grayscale Bitcoin ETF dropped to near $22 million in late February, it has rebounded now and broken the decreasing pattern.

Bitcoin Price Drops Below $65,000

In addition, Bitcoin price has kept falling. According to CoinMarketCap, Bitcoin is trading at $64,661 at the time of writing, down by 5.92% over the past 24 hours and declining more than 10% comparing to a week ago.

Crypto.com CEO Kris Marzsalek recently commented on the Bitcoin price correction, claiming that the downturn would be “healthy” for the market.

“I think it’s a healthy move, um, removing some of the leverage that is built up in the system,” said Marzsalek.

Marzsalek also predicted a steady ramp up ahead, saying, “We want to avoid sudden, super aggressive spikes. We would really like to see a steady inflows into the industry… that will allow us to have about 12 to 18 months.”