Selling pressure drives BTC down by 10% in the past week, sliding from $42,864 to $38,550.
Concerns rise as $640 million exits GBTC, putting pressure on BTC prices.
The Bitcoin market is grappling with a significant shift in momentum as selling pressure intensifies, giving bears the upper hand. The prominent asset manager, Grayscale, known for overseeing the Grayscale Bitcoin Trust (GBTC), is playing a pivotal role in driving this trend.
While initial excitement over spot Bitcoin ETFs led to a brief uptick in Bitcoin prices, the subsequent days saw a dip below $40.000. Also, amidst the huge competition among ETF issuers to attract investors through lower fees and promotional offers, the broader crypto market saw a 2.3% decline in its overall market cap.
Bear Dominance on the Rise
Despite the launch of Bitcoin exchange-traded funds on January 11, it has displayed a flurry of activity. The crypto community is surrounded by concerns about Grayscale dominance, marked by a $640 million outflow from its GBTC on Monday and a total net outflow of $3.4 billion.
This selling pressure has taken a toll on BTC’s price, witnessing a significant downtrend of 10% over the past week. On Tuesday, the leading cryptocurrency experienced a dip to $38,500, testing a critical support level. Despite the bearish pressure, the $38,500 support has displayed a slight upward rebound to $39,647 at the time of writing.
If negative market sentiment persists, there’s a chance for Bitcoin to revisit the $30,000 mark, just above the key $29,000 level that marked the onset of the bull run, leading Bitcoin to its 22-month high of $49,000 on January 11th.
If BTC fails to maintain above the $38,800 level, it could open the door to a new decline toward the key support at $36,200. Further downward could signal a shift in momentum, with key levels at $30,000 to $32,000. A breakdown below these levels might grant bears the upper hand in the mid-term, at least until the anticipated halving event in April.
However, analysts remain optimistic about Bitcoin’s trajectory, as the total trading volume of Bitcoin ETFs nearly reached $12 billion in weekly flow. Also, Bitcoin spot ETFs have surpassed silver ETFs, positioning BTC as the second-largest commodity ETF player.