Maindivider Newsdivider Why is Grayscale selling Bitcoin?
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Why is Grayscale selling Bitcoin?

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calendar 19-01-2024
Prior to the approval of the Spot Bitcoin ETF, Grayscale redeemed its shares, thereby providing investors with USD but never selling BTC.

This is precisely why Grayscale has become one of the largest holders of Bitcoin alongside Satoshi, the US government, and other top holders.

Now, after the approval of the Spot Bitcoin ETF, investors are withdrawing their money from GBTC for two reasons:

1. Grayscale charges a 1.5% annual fee, which is 5-6 times higher than other ETF issuers, such as Blackrock, for example. The good news is that some investors are transitioning from GBTC to other Spot Bitcoin ETFs.

2. Many investors bought GBTC at a 40% discount, and now it is almost 0%, so they are exiting their positions and locking in substantial profits (considering that, in addition to the reduction in the discount, they also benefited from the rise in Bitcoin).

In both scenarios, GBTC will now have to sell Bitcoin to settle with investors.

When will this end?

It may take several weeks, during which time Bitcoin could trade sideways if demand can absorb Grayscale's sales. Otherwise, the price may continue to decline.

Once everything settles, investors will transfer their money from GBTC to other Spot Bitcoin ETFs with lower fees.

Remember that this is a long-term game, and we need to be patient; otherwise, we will simply hand over all our Bitcoins to the big players on Wall Street.

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