ARK Invest, led by Cathie Wood, sold approximately 700,000 shares of the Grayscale Bitcoin Trust (GBTC) in the last month. Despite this significant sale, the ARK Next Generation Internet ETF (ARKW) still maintains a strong position with 4.3 million GBTC shares, valued at $131.8 million.
This selling activity commenced on October 23 and extended until November 22, a period during which BTC reached 17-month highs, partly due to expectations surrounding the launch of a Bitcoin spot exchange-traded fund (ETF).
The sale of GBTC shares by ARK Invest included 36,168 shares on November 22, totaling a sale of 697,768 shares since late October, according to ARK’s daily trading data.
Despite this sale, GBTC remains a significant part of ARKW’s portfolio, representing 9.2% of the total, ranking it third after Coinbase and Roku, according to official ARKW data.
In terms of performance, the ARK ETF that executed these sales has seen a 68% increase year-to-date, while Grayscale’s trust outperformed this with over 271%. It’s crucial to note that BTC experienced a 125% increase in the same period, nearing $38,000 on November 16.
Expectations for the Spot Bitcoin ETF
Simultaneously, JPMorgan issued a report on the Grayscale Bitcoin Trust, suggesting that a significant number of shares were acquired at considerable discounts in the secondary market. This phenomenon occurred in anticipation of the potential approval of the trust’s conversion into an ETF. An estimated $2.5 billion has flowed into GBTC since the beginning of the year, increasing to $2.7 billion when considering short interest covering.
JPMorgan raises the possibility that these funds might completely exit the Bitcoin space if GBTC converts into an ETF, potentially exerting downward pressure on BTC prices. However, it also notes that if these funds shift to other BTC instruments, such as the newly created Bitcoin spot ETFs post-SEC approval, the negative impact could be more moderate.
Looking ahead to the year-end, major investors anticipate developments regarding Bitcoin ETFs. The SEC currently shows no signs of action on the matter. It will be necessary to wait a few more weeks to see the final decision and its impact on the price of Bitcoin and the overall crypto market.
