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January 25, 2024
Everyone wants to buy and sell bitcoin after the SEC made it easier

Over the last two weeks, Bitcoin’s value has dropped by 15% as some investors have taken advantage of the much-heralded introduction of bitcoin exchange-traded funds earlier this month to sell their risky cryptocurrency holdings and pocket the profits. However, ten new funds were launched on January 11, 2024, after the US Securities and Exchange Commission approved them. Investment group CoinShares states that the ten new funds raked in $4.7bn today. Many believe that much of the money from the ten new funds is from investors who are exiting Grayscale because they charge higher fees than most competitors. Before being changed to an exchange-traded fund (ETF) on January 11 with approval from the Securities and Exchange Commission, the $27 billion trust was a closed-end fund.

The US Securities and Exchange Commission announced its approval of an investing tool that was announced on X social after a hack to obtain the news ahead of time. With everyone excited about the news — why hasn’t that translated into a rise in the cryptocurrency‘s price?

Exchange-traded fund (ETF) is a type of investment fund that is an exchange-traded product that is traded on the stock exchanges. ETFs own financial assets, like stocks and bonds, etc. They track and seek to outperform the underlying index.

Since Grayscale’s bitcoin fund was converted to an ETF earlier this month, a sizable portion of withdrawals have been ascribed to the FTX bankruptcy estate, according to Coindesk.

Cryptocurrency corporation sold 22 million shares of the Grayscale Bitcoin Trust for $900 million.

The cryptocurrency corporation sold 22 million shares of the Grayscale Bitcoin Trust for $900 million, fully liquidating its ownership in the fund, according to CoinDesk, which cited anonymous sources and pertinent data.

This sum is part of a more significant wave of GBTC withdrawals that have sold nearly $2 billion worth of shares since the investment vehicle was converted to an exchange-traded fund this month. Grayscale has experienced more outflows even though it was the first to trade, which the research suggests is partly caused by FTX’s selling.

Because Grayscale’s competitors in the business were demanding fees between 0.2% and 0.9%, a fee war was already developing before the SEC approved the spot ETFs. 1.5% is one of GBTC’s fees.

Many had predicted that the approval of the ETFs would drive up the bitcoin price, but this may not be the case since the token’s value has dropped along with those of GBTC shares, falling 13.69% and 12.68%, respectively.

With the lower price, some have suggested that this may be the time to dip their toes in the crypto market.

Featured Image Credit: Worldspectrum; Pexels

The post Everyone wants to buy and sell bitcoin after the SEC made it easier appeared first on ReadWrite.

 

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