Grayscale's Bitcoin Holdings Plummet, Signaling a Trust Exodus

Grayscale's Bitcoin holdings have dropped significantly since its ETF conversion, falling from 624.28K to 361.79K. The US spot Bitcoin ETFs have faced a decline in demand, with cumulative net outflows for four consecutive days. Grayscale's GBTC has been the main source of outflows, while BlackRock's IBIT has seen some inflows. The overall constrained demand for ETFs has lagged behind the price action of Bitcoin, with attention now shifting to spot BTC ETF demand and the upcoming Bitcoin halving event.

Is Grayscale's BTC Hold Drying Up?

Grayscale's once-formidable Bitcoin (BTC) holdings have dwindled to 361.79K, a far cry from the 624.28K it held pre-ETF conversion in January. The exodus from Grayscale's Bitcoin Trust (GBTC) has been relentless, with $1.83B in outflows over the past four days alone.

Is GBTC Bleeding Its Life Away?

On March 21st, GBTC's outflows reached a staggering $358.8M, prompting Bloomberg's James Seyffart to quip: "Outflows ain't stopping." Since the ETF conversion, GBTC has hemorrhaged $13.36B, marking a 42.3% decline in its BTC holdings.

Can iShares Counter the GBTC Exodus?

BlackRock's iShares Bitcoin Trust (IBIT) has emerged as a beacon of hope amidst the GBTC gloom. IBIT has absorbed $451.5M in inflows, but its performance has been erratic, with "dismal" days on Tuesday and Wednesday. However, it rebounded on Thursday with $233.4M in inflows.

Are ETFs Losing Their BTC Mojo?

Despite the BTC price retracement, spot BTC ETFs have failed to ignite demand. Their cumulative net outflows for the fourth consecutive day underscore the waning interest in these investment vehicles.

Bitwise and Ark Shine Amidst the Gloom

While GBTC falters, Bitwise (BITB) and Ark (ARKB) have reached significant milestones. BITB has surpassed $1.5B in cumulative inflows, and ARKB has crossed the $2B mark. However, the broader ETF landscape remains constrained by the lack of demand.

Will the Fed's Pivot Revive BTC ETF Demand?

The market's focus has shifted from the dovish Fed rate decision to the waning spot BTC ETF demand and the upcoming Bitcoin halving event in mid-April. Will the Fed's pivot spark a resurgence in BTC ETF appetite, or will the outflow trend persist?