Grayscale's GBTC Has Moved More Than 100K BTC to Exchange Since Spot Bitcoin ETF Launch

Grayscale's Bitcoin Trust (GBTC) moved more than 19,000 bitcoin [BTC] from its publicly known wallet Wednesday morning. Since the spot bitcoin ETFs opened for business on Jan. 11, Grayscale has now moved nearly 113,000 bitcoin from its wallet, the overwhelming majority of which was to Coinbase Prime in preparation for sale, according to data compiled from Arkham.

The Grayscale website Wednesday morning showed GBTC as holding roughly 537,000 bitcoin, down about 100,000 BTC since Jan. 11.

As Arkham noted, one caveat to the observed movement of bitcoin out of the Grayscale wallet is that not all of that may be related to redemption. "The outflows are usually split between Coinbase Prime and new GBTC custody addresses," said Arkham. "This means that not all of the BTC moved is being redeemed. The outflows appear to be settlements of trading activity for the previous day(s)."

Due to the input-output structure of its blockchain, Bitcoin transaction outputs are often split amongst multiple addresses.

GBTC custody wallets frequently send to multiple addresses, most often a Coinbase Prime deposit and a fresh GBTC custody address. This means that some of… pic.twitter.com/Oml9IhLDMp

— Arkham (@ArkhamIntel) January 24, 2024

GBTC has seen this massive outflow for any number of reasons, but principally as Grayscale cut its management fee just 50 basis points to 1.50% following the conversion to a spot ETF. That's more than 100 basis points higher than the other nine competing bitcoin ETFs. Assets under management (AUM) at Grayscale have fallen more than $1 billion each day this week.

The fast pace of GBTC bitcoin sales is among the factors putting pressure on the price of bitcoin, which earlier this week tumbled below $40,000 to its lowest level in nearly two months. Bitcoin at press time was at $39,800, about flat over the past 24 hours.

The hopes of bitcoin bulls were momentarily buoyed earlier this week on a Monday CoinDesk report that the FTX estate had unloaded its 22 million share GBTC holding. With this non-economic whale seller out of the way, the bulls hoped there might be a slowdown in GBTC exits. To this point though, this hasn't happened, as evidenced by this morning's movement of 19,000 bitcoin to exchange.

Read more: Crypto Whales Hunt for Bargains As Bitcoin Prices Slide, Data Shows