ETF Outflows Reduce Balances
According to CoinFactiva analysts, for four consecutive days, U.S. spot Bitcoin ETFs have experienced outflows, reducing their combined balance by $879 million to $15 billion since June 7.
Short-Term Holders Classification
These funds are classified as short-term holders (STH), as their history spans less than six months, with the exception of Grayscale’s GBTC, which was converted from a trust. This distinction is crucial to avoid double-counting errors.
Whale Sales and Pressure on Bitcoin
Over the past two weeks, long-term holding whales have sold $1.2 billion worth of Bitcoin, with $370.7 million of that attributed to GBTC. ConinFactiva analysts conclude that, whales and ETFs have collectively exerted $1.7 billion of selling pressure during this period.
Significance of the Selling Pressure
Given the low network activity, characterized by a decrease in active addresses and low transaction volumes, this does pose some resistance to further price growth.
Insufficient for a Full-Scale Correction
However, these amounts are insufficient to trigger a full-scale correction.
Support from Long-Term Holders
The primary support for Bitcoin’s price is the commitment of long-term holders (LTH) to accumulation. This can be seen in the daily chart of LTH coin transfers to crypto exchanges: if in January and March they were sending an average of 0.05% of their total holdings daily, now this figure has dropped to 0.006%.
Comparative Sales and Trading Volume
Additionally, the $1.7 billion in sales pales in comparison to the total spot market trading volume, which amounted to $1.6 trillion in May.
Contextualizing Whale Sales and ETF Outflows
While news of large whale sales or prolonged outflows from ETFs can be unsettling and add to investor anxiety, it’s important to view these developments in the context of broader trends and sentiments.
Anticipated Second Wave of Demand
For example, Franklin Templeton CEO Jenny Johnson (with AUM over $1.3 trillion) believes that a second wave of demand for spot ETFs, driven by more institutional investors, will soon follow the first. Given the ongoing outflows to cold wallets and reduced new supply due to the halving, Bitcoin is expected to reach a new record by the end of the year.
