Grayscale Bitcoin Trust (GBTC) unlock has been the topic of discussion in the crypto sphere for the past couple of weeks as many expected the unlocking of shares after 6-months could have a bearish outcome on the Bitcoin price. However, contrary to mainstream belief BTC price has managed to escape any sell-off during the unlock phase.
The biggest unlock came on July 18 and now we are past the major unlockings for July. BTC price has continued to trade in the same price range of $30K-$35K for the majority of July. Despite yesterday’s break of key support level $30K for BTC, the top cryptocurrency has managed to climb back above $31.5K earlier today. BTC was trading at $31,557 at the time of writing with a 6.3% price climb over the past 24-hours.
Biggest GBTC unlocks have passed now pic.twitter.com/4tCv3DD61P
— unfolded. (@cryptounfolded) July 21, 2021
The biggest cause of the FUD was the general beleive that Grayscale would potentially sell its Bitcoin holdings on the unlock. However, the GBTC trust cannot sell any of the BTC deposited by the accredited investors against GBTC shares. The only downside was the spot market pressure that the unlock could have potentially created due to a negative premium. Analysts believed a negative premium would have persuaded traders to buy GBTC shares instead of spot BTC as it would have been cheaper.
However, Coingape had reported that shareholders might not be willing to sell their shares due to the negative premium on them.
Institutions Buy More GBTC Shares on BTC dip
The Bitcoin price dip below $30K had many traders worried about the further downside of losing critical support. However, institutions continued to buy the dip with Cathie Wood-led Ark Invests purchasing another $10.5 million in GBTC shares.
Even when the crypto market has lost more than half of its valuation since its ATH in May this year, institutional investors continue to show support and confidence in the crypto world. Earlier today, BNY Mellon, the world’s oldest custody bank joined six other financial institutions to back another crypto exchange. Four of the top-6 custody banks offer Bitcoin custody services.
4 of the Top 6 custody banks in the world now offer #Bitcoin custody services.
JPMorgan +Citi are looking into it… pic.twitter.com/pM9I6kr95i
— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) July 21, 2021