BTC price risks $40K breakdown as GBTC ETF steps up Bitcoin outflows

Grayscale sent BTC worth an estimated $700 million to Coinbase to start the week, with BTC price action weakening.

Bitcoin (BTC) kept $40,000 retests coming at the Jan. 22 Wall Street open amid ongoing BTC sales from asset manager Grayscale.

GBTC Bitcoin outflows seen passing $700 million

Data from Cointelegraph Markets Pro and TradingView confirmed new six-week lows of $40,324 on Bitstamp.

BTC price action, while mostly stable over the weekend, faced continued sell-side pressure into the new week as the Grayscale Bitcoin Trust (GBTC) decreased its assets under management.

As part of the ongoing changes following the approval of its transition to a spot Bitcoin exchange-traded fund (ETF), Jan. 22 outflows totaled 19,250 BTC ($785 million), per live data from crypto intelligence firm Arkham.

Other sources named a higher daily tally, with Alex Thorn, head of research at crypto reconnaissance firm Galaxy, putting it at a preliminary $700 million.

Reacting, Eric Balchunas, a dedicated ETF analyst at Bloomberg Intelligence, warned that the sales, which came in the form of transactions to custodian Coinbase, may be simply too large to be absorbed by the other ETF players.

“Can only hope it’s a bit less than this. Half a billion is about the limit of manageability for the Nine,” he said about Thorn’s total, referring to the nine other ETFs currently operating.

based on my tagging i’m seeing between $623.7m and $784.7m sent this AM, which is the largest settlement between Grayscale & CB prime i’ve seen so far

— Alex Thorn (@intangiblecoins) January 22, 2024

Others were still satisfied with the progress made by the new spot ETF cohort, with inflows still net positive.

GBTC still contained more than $20 billion in assets, with its share price relative to BTC spot at just a 0.27% discount as of Jan. 19, per figures from statistics resource Bitcoin Treasuries.

“Mad heavy” BTC price fields bearish forecasts

BTC price strength thus held its own, keeping $40,000 as support despite increasing conviction that lower levels would result.

Related: Are BTC longs waiting for sub-$40K? 5 things to know in Bitcoin this week

These focused on the mid-$30,000 zone, with various popular traders identifying it as an opportunity to go long BTC next.

Commenting on the status quo on the BTC/USDT order book on largest global exchange Binance, meanwhile, trading resource Material Indicators noted increasing bidder interest at $38,500.

#FireCharts shows another $36M in #BTC bids stacked above $38.5k.

Learn more about FireCharts here. https://t.co/z8VpL3p88E pic.twitter.com/yLEWDAIwbn

— Material Indicators (@MI_Algos) January 22, 2024

“Bitcoin has seen a lot of violent moves during the first 1-2 hours after the US Market Open. This is likely because many of the ETF flows, that tend to occur near the start and end of a trading day,” popular trader Daan Crypto Trades reasoned.

“I think we break $40k. I went long some 29Mar $35k strike puts,” he revealed to X subscribers.

Earlier on the day, Arthur Hayes, former CEO of derivatives giant BitMEX, called BTC/USD “heavy” and joined those predicting new lows.

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.