The cash flow into the Grayscale Bitcoin Trust is not strong enough for Bitcoin price to break above $ 40,000
According to Bloomberg, investment bank JPMorgan said the significant slowdown in capital inflows to Grayscale’s Bitcoin fund is likely to prevent Bitcoin price from hitting $ 40,000 again.
Currently, the cash flow into the Grayscale Bitcoin Trust is not strong enough for Bitcoin price to break above $ 40,000
About a month ago, JPMorgan strategists warned that a drop in the flow could trigger a brutal market correction. At the time, Bitcoin was trading for under $ 24,000.
After Bitcoin exploded higher and hit its current all-time high of $ 42,000 on Jan. 8, the rally became too hot to be sustainable and a series of corrections followed. At press time, the cryptocurrency is trading at $ 33,371 on the Bitstamp exchange.
JPMorgan noted that Grayscale’s cash flow dropped even more sharply than Bitcoin itself (22% and 17%, respectively) last week.
The report stated:
“At the moment, the institutional flow impulse behind the Grayscale Bitcoin Trust is not strong enough for Bitcoin to break out above $40,000.”
Grayscale reopened its trust fund on January 12 after it closed for new investors on December 21. According to the January 22 update, Grayscale Bitcoin Trust currently holds only valuable assets. more than $ 20 billion under management.
Grayscale’s newly appointed CEO Michael Sonnenshein recently made a major new announcement on Twitter, but it’s not clear if it has anything to do with Bitcoin or some of the company’s new trusts tied up with different altcoins or not.
In addition to seemingly waning institutional demand, Bitcoin’s recovery has been hampered by a strong rally in Ethereum accompanied by double-digit gains in the decentralized financial sector.
Earlier today, ETH achieved another all-time high of $ 1,475 on the Binance exchange. Bitcoin Dominance is now down to 62.45%, the lowest level since late November.
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