The static supply of Bitcoin, according to a report by Ark Invest, reached a historic peak in June, with almost 70% of the circulating supply remaining unmoved for a year. The paper, with the suggestive title, “The Dawn of the ETF Era?”, anticipates a revival in the Bitcoin market sparked by the prospective launch of a new spot Bitcoin exchange-traded fund (ETF). On-chain data are also seen as a propulsion for price appreciation in the near future.
Highlighting the progressively expanding share of the circulating Bitcoin supply under the control of long-term holders, Ark Invest asserts the strengthening of the holder base. With close to 70% of the coins having been retained for a minimum of one year; the share of the Bitcoin pie belonging to long-term holders has now touched an unparalleled high, in both relative and absolute terms.
Institutional interest is on the rise, adds fuel to the bullish stance ignited by the long-term holders. Notably, financial behemoths like BlackRock, renowned as the largest asset manager globally, filed an application to introduce a spot Bitcoin ETF last month. This move was mirrored by other significant asset managers including Invesco, Fidelity and WisdomTree. All these entities aspire to pioneer the launch of an ETF supported by spot Bitcoin rather than Bitcoin futures, an advancement anticipated to send Bitcoin prices soaring.
Despite concerted efforts, to date, all endeavors to list a spot Bitcoin ETF have been shunned by the US Securities and Exchange Commission (SEC). However, a remarkable development occurred recently as the discounted net asset value (NAV) of the Grayscale Bitcoin Trust (GBTC), started to narrow. GBTC, an investment conduit enabling investors Bitcoin exposure in the absence of a bona fide spot Bitcoin ETF in the US, has long desired to metamorphose into a spot Bitcoin ETF to close this discount, a move consistently foiled by the SEC.
The submission of the ETF filing by BlackRock has however breathed new hope into the market. This, coupled with the belief that a conversion will get the nod and the discount will thus be obliterated, investors are beginning to swarm back to GBTC.
Headed by acclaimed technology investor Cathie Wood, Ark Invest has substantial investments in Bitcoin and firms operating in the crypto industry, like Coinbase. In mid-March, the company gathered more than $16 million for two new private crypto funds. Despite the optimistic signs, it’s important to be cautious and conduct thorough research before investing.
Source: Cryptonews
