After Grayscale Bitcoin Trust (GBTC) was converted into an exchange-traded fund, the assets of bankrupt FTX sold GBTC shares now worth about $1 billion.
Sales Details
FTX, which filed for Chapter 11 bankruptcy on November 11, 2022, recently sold 22 million shares of GBTC stock, which were converted into a Bitcoin ETF earlier this month on January 11.
This sale by FTX has now effectively reduced its stake to zero. Before the sale, FTX held 22.3 million shares of GBTC stock worth $597 million as of October 25, 2023.
The conversion of the Grayscale Bitcoin Trust into an ETF was a milestone in the cryptocurrency industry, followed by the SEC’s approval of several new Bitcoin ETFs.
Bitcoin ETF issuers such as Grayscale and Fidelity’s funds have seen significant inflows, while GBTC has seen significant outflows, with sales from FTX accounting for a significant portion of the decline.
meaning of the future
FTX’s cryptocurrency holdings extend beyond GBTC and include five Grayscale trust shares and approximately 3 million shares in a fiat trust managed by ETF provider Bitwise.
These holdings are currently held in a brokerage account with ED&F Man Capital Markets, recognized as Marex Capital Markets Inc. Both Marex and Galaxy Digital declined to provide comment on the situation.
Meanwhile, FTX’s sister company Alameda Research voluntarily dismissed its lawsuit against Grayscale, alleging that the company charged excessive fees.
bitcoin price movement
Data shows that contrary to the bullish speculation about Bitcoin expected following the ETF’s approval, the price of Bitcoin has declined significantly since the ETF’s launch. Many analysts predicted that Bitcoin ETFs would provide easier investment opportunities for the general public, sparking positive speculation at the same time.
as a result
FTX’s strategic move to offload GBTC stock further complicated market dynamics. There is speculation that selling pressure on GBTC may ease as FTX completes the sale of a significant amount of GBTC held. The unique event of a bankruptcy estate liquidating its holdings may have contributed to the recent outflow.