Bitcoin (BTC) may have traded sideways for most of the past month thanks to Grayscale, but the status quo will change soon.
According to data from on-chain analysis tool CryptoQuant, the Grayscale Bitcoin Trust (GBTC) price premium just hit its lowest level since April 2019.
Grayscale locking ends Wednesday
Grayscale has regularly made headlines this year thanks to Register BTC purchases and record demand, but despite the inflows, BTC / USD has not continued to rise.
At the beginning of February, the Trust’s purchase premium is around $ 6.50, previously it was $ 40 over the course of its existence. This historically coincides with a meandering price direction, while large premiums equate to big upward moves for Bitcoin.
At the end of December, a special article In technology magazine Hackernoon explained the phenomenon that it is related to releases of GBTC shares that were subject to a usual lock-up.
Once released, Bitcoin tends to skyrocket as customers return their profits to BTC, while the time leading up to such events corresponds to a lack of price action.
“What’s important to know is that once these higher prices and premiums are realized after an unlock, the price continues to consolidate. This allows the bount to shrink again for the next unlocking event, ”Hackernoon summarized.
With the next unlock set set for February 3rd, expectation should build for a continuation of the Bitcoin bull run.
“This void can cause premiums to shrink again, just like the nine times before,” the article continued, correctly predicting price behavior for the second half of January.
And it will continue to shrink until the next unlock. Because of this, I expect the price to consolidate or fall. “
No slump for grayscale investments
Grayscale, meanwhile, continues to expand its offering as institutional interest broadly shows no signs of slowing down for both Bitcoin and altcoins.
This week, the Ethereum Trust reopened after being closed since December, while crypto-focused event Grayscale will sponsor the Bloomberg Crypto Summit on Feb. 25.
GBTC had $ 21.8 billion in assets under management as of February 1. Ether (ETH) purchases have been interrupted since December 10.