Original - Odaily
Author - Azuma
The market decline in the post-ETF era continues.
From last night to this morning, the market continued its downward trend. OKX market data shows that BTC has fallen below 40,000 USDT, temporarily trading at 39,701.1 USDT, a 24-hour drop of 4.4%; ETH has fallen close to 2,300 USDT, reaching a low of 2,302.01 USDT, with a 24-hour drop of 5.4%.
In addition to BTC and ETH, some Alt-coins that had previously been quite strong have also experienced significant corrections. As of the time of publication, SOL was temporarily reported at 86.64 USDT, a 24-hour decrease of 7%; ARB was temporarily reported at 1.69 USDT, a 24-hour decrease of 6.8%; OP is temporarily quoted at 3 USDT, down 4.2% in 24 hours; TIA is tentatively quoted at 15.24 USDT, down 9.1% in 24 hours.
Affected by the overall downward trend, the total market value of cryptocurrency has also shrunk significantly. CoinGecko data shows that the current total crypto market value has shrunk to US$1.63 trillion, a decrease of 4.3% in 24 hours. Crypto users trading enthusiasm has also declined significantly. Today, the panic and greed index has reached 50, and the level has dropped from greed which has been in place for a long time to neutral.
In terms of derivatives trading, Coinglass data shows that the entire network has liquidated positions of US$252 million in the past 24 hours, most of which were long orders, amounting to US$217 million. In terms of currency types, BTC liquidated positions of US$74.65 million and ETH liquidated US$64.87 million.
Reason for the decline: Are all the good news gone? Taking profits? Grayscale smashing the market?
Since the Bitcoin spot ETF was officially approved on January 10, the market has been in a downward trend. Based on the peak price of BTC after that date (high point 48988, low point 39757), the overall market correction has been close to 20%. .
Various institutions and analysts have different opinions on the reasons for the decline.
Some voices believe that this is a foreseeable callback after the benefits of ETFs run out.Chris Burniske, former head of crypto business at Ark Invest and now a partner at Placeholder VC, predicted on the day after the ETF was approved: “The current situation is easily reminiscent of the spectacular IPO of Coinbase. At that time, many people were worried about the incident. It raised expectations for the market, but looking back, that was the highest point for BTC in several quarters.”
Analysts at BitBank also hold the same view. In an email sent to customers, the institution predicted that the ETF may reach the short- to medium-term top of BTC prices when it is approved.
From market data sources, the overall operating trend of large traders is also in line with this prediction. Kaiko data shows that the selling pressure in the market after the ETF was approved was mainly concentrated on Binance, OKX and Upbit.The main reason for the price drop seems to be that large long-term traders are taking profits in response to the current ETF market.
Focus on more intuitive news,The current most concerning trigger for the decline is Grayscale’s continued selling behavior.
Odaily Note: For details, please refer toThe ETF was approved but BTC plummeted because of Grayscales market crash? How much selling pressure is still on the way? 》。
GBTC’s positioning switch opens up a channel for reverse redemptions for early investors. According to an analysis report compiled and written by Kiarash Hossainpour, founder of Colorways Ventures and The Consensus, since the approval of the Bitcoin spot ETF, GBTC’s BTC holdings have reduced from 621,000 to just under 580,000, with outflows of more than 40,000. , which is approximately US$1.6 billion at current prices.
In addition, according to sources, FTX seems to be the main source of GBTC selling pressure this time. The institution has sold 22 million GBTC units, worth nearly US$1 billion.
What is the future direction of the market? Is there still hope for a rebound?
Combined with multiple parties’ judgment on the market outlook,It seems that most investors are not optimistic about the short-term follow-up market.
Kiarash added in the above report that there is still a selling pressure of 281,045 BTC on GBTC, worth approximately US$12 billion.
JPMorgan analyst Nikolaos Panigirtzoglou’s team also pointed out that if GBTC investors continue to take profits, Bitcoin prices may face further downward pressure in the coming weeks. However, Nikolaos is more optimistic than Kiarash, believing that the final outflow value of GBTC will be approximately US$3 billion.
BitMEX co-founder Arthur Hayes, who has a good record of market predictions recently, also predicted yesterday that he is pessimistic about the future price trend of Bitcoin. He believes that Bitcoin will soon fall below the $40,000 mark (which came true today). To this end, Arthur has purchased a put option expiring on March 29 with an exercise price of $35,000.
Arthur also emphasized that the decline in Bitcoin prices may continue until the release of the U.S. Treasury Department’s quarterly refinancing announcement on January 31.
However, while we are collectively bearish on the short-term market,Many investors remain positive about longer-term market trends.
Sources familiar with FTX said that FTX has cleared out its GBTC shares. Given that the institution has been the main force in GBTC selling so far, it is expected that the market’s selling pressure may lessen in the coming period.
Galaxy Digital CEO Michael Novogratz said the price of Bitcoin could be “higher within six months.” Michael explained that only 30% of the current outflows from GBTC may have been diverted to other ETFs. As this proportion increases, the current market uneasiness will gradually subside, thereby pushing Bitcoin to rush higher within six months. s price.
Matt Hougan, Chief Investment Officer of Bitwise, summarized the current market situation very succinctly: People have overestimated the short-term effect of Bitcoin spot ETFs, but also underestimated the long-term effects of ETFs.
All in all, investors may be a little disappointed with the market trend after the adoption of ETFs, but combined with the changes in market sentiment, this script is not too surprising. The approval of ETF is certainly a good thing, but the buying effect it brings will not appear instantly, but will take time to gradually accumulate.
In the past week, even with GBTC disrupting the situation, we still saw that the ETF market as a whole showed a trend of net inflows. The former will eventually end, while the latter has just begun. One will ebb and flow, and the market sentiment will eventually usher in change.
