Ki Young Ju, founder of CryptoQuant, a blockchain analytics company, got that a curious trend. In a post on
The United States Securities and Exchange Commission (SEC) recently approved these new whales to list Bitcoin exchange-traded funds (ETFs) for all investors.
Moving coins from “ancient whales”: sale or risk mitigation?
Although a definitive liquidation is not confirmed, commentators who responded to the founder’s post believe that these “old whales” may be mitigating the risk. In their opinion, transferring your Bitcoin stash from self-custody to a regulated investment vehicle, such as spot Bitcoin ETFs, is a better measure to cover unexpected eventualities.
If this is the approach, then it could prove strategic. Bitcoin holders can carry out transactions without relying on third parties. Notably, this development coincides with a significant drop in BTC supply on major exchanges like Coinbase and Binance, as well as on GBTC.
The decline has accelerated since the introduction of spot Bitcoin ETFs, suggesting a possible move away from exchanges. Meanwhile, GBTC traders are unwinding the product and converting it into a spot Bitcoin ETF following a court ruling.
Will Spot BTC ETFs Gain Traction?
Still, the fact that “old whales” are moving their coins into centralized products like ETFs contradicts the core philosophy of BTC as a tool for financial self-sovereignty. It remains to be seen whether more users, particularly retailers, will choose to own spot Bitcoin ETF shares rather than the underlying coins directly.
Institutions may be required by law to use a regulated product if they need to be exposed to BTC. However, retailers can choose to buy directly from exchanges or mine. This freedom could lead to more retailers choosing to buy BTC.
This trend comes ahead of the highly anticipated Bitcoin halving. This event is scheduled for mid-April 2024 and will further reduce the circulating supply of BTC, potentially driving up prices. Before that, BTC prices are firm, stable above $70,000 at the time of writing.
DALLE Featured Image, Chart from TradingView
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