Arcane Research: Grayscale unlocks did not affect Bitcoin’s price

Mass unlocks of Grayscale Investments’ Bitcoin Trust (GBTC) from July to August did not lead to a widening of the instrument’s discount to NAV. A pause in this process over the next six months is expected to relieve pressure on digital gold, according to Arcane Research.

In this week’s edition of the weekly update
🔹Sub-Saharan Africa surpasses Northern America and becomes the largest region in terms of trading volume in the P2P markets globally
🔹Growing contango in the futures market
🔹Spiking trading volumeshttps://t.co/A4E68ApbNe

— Arcane Research (@ArcaneResearch) August 3, 2021

The GBTC price discount to NAV has been observed since February 23. The unlock of 41,700 BTC, contrary to analysts’ expectations, did not widen it; instead, it narrowed from 15% in mid-July to 6%. By August 22, the lock-up period for new GBTC share tranches will end, after which it will fade away in the next six months.

Experts forecast further contraction of the discount. Confirmation of the forecast would create an incentive for investors who have the opportunity to redeem GBTC on the market to hold their positions. Many of them may anticipate the subsequent conversion of the instrument into a Bitcoin ETF.

In July, Arc Invest’s purchase of 450,000 GBTC shares provided notable support for the trust’s price, analysts said.

The futures market sentiment improved. Three-month contracts on leading crypto-derivative exchanges moved into contango at levels seen in mid-May, though there has recently been some cooling of the bullish consensus.

Analysts noted a lower premium on the CME compared with unregulated platforms, indicating a more cautious stance among institutional investors, they added. They warned of potential long liquidations if Bitcoin fails to hold support at $37,000.

Earlier, in QCP Capital were skeptical about the risks surrounding the end of the GBTC lock-up period for Bitcoin.

In late July, Glassnode analysts noted the absence of fundamental factors backing the Bitcoin rally.

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