Bitwise: Bitcoin Price Selling Pressure Comes From Excess Expectations Passed by Spot ETF

Asset management firm Bitwise's Chief Investment Officer Matt Hougan stated on Twitter that the recent continuous decline in the price of Bitcoin ETF is due to the market's excessive expectations in the past for the approval of spot ETFs, and now the market is unwinding positions related to that bet.

Bitcoin ETF Price Decline

Market Profit-Taking

Matt Hougan believes that the recent selling pressure is profit-taking from the initial anticipation of a Bitcoin spot ETF approval. At that time, the market bought a large amount of spot Bitcoin and Bitcoin derivatives in anticipation of the ETF approval news, leading to profits. The net capital inflow into the ETF will be more than the actual demand, and now the market is unwinding this investment, causing the current sell-off, which requires waiting for the market to digest.

However, Matt Hougan also mentioned that just as the market overestimated the short-term impact of the ETF, it also underestimated its long-term impact.

Continuous Selling of GBTC

Furthermore, Matt Hougan pointed out that Grayscale's Bitcoin ETF GBTC continues to see a net outflow of assets, but the overall Bitcoin spot ETF market still shows a net inflow, with the amount of BTC purchased by new ETFs exceeding the amount sold by GBTC.

ETF analyst James Seyffart believes that the outflow rate of funds from GBTC will ultimately fall between 20% and 35%.

Mt. GOX + GBTC holding a total of 700,000 bitcoins waiting to be sold? BTC price continues to decline