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July 19, 2024
PI Global Investments

11,500 BTC Withdrawal Reflects Confidence in Bitcoin’s Value

The first batch of ETF approvals came in last week. In the aftermath, Synapse Network co-founder Paweł Łaskarzewski has shed light on BlackRock’s moves that have captured the crypto community. Within a mere 2 days, the prominent investment giant withdrew a massive 11,500 BTC from the supply.

In the latest post on X (formerly Twitter), Łaskarzewski emphasized that BlackRock’s rapid acquisition, especially because around 900 new BTC are mined daily, signifies a strategic shift. Noteworthy is the approach of buying the dip, a move that reflects confidence in the value of Bitcoin.

BlackRock’s Bitcoin ETF (IBIT) Under the Lens

BlackRock’s acquisition removed 11,500 BTC from the system in just two days, which is equivalent to roughly 13 days of the usual daily supply.

The exec said that the sheer scale of this substantial move underscored the “accelerated pace of institutional adoption” within the crypto space.

The impact of BlackRock’s iShares Bitcoin Trust (IBIT) was scrutinized. Despite managing only 25% of the volume over two days, when factoring in the influence of GBTC, an estimated 46,000 BTC may have been withdrawn. This hints at a potential signal of an impending supply crunch.

Assuming a sustained pace of 23,000 BTC per day, Łaskarzewski said the supply consumption is approximately 25.56 times the daily production consumed by US ETFs alone. This calculation excluded retail investors and other global ETFs, pointing towards a severe supply crunch on the horizon.

Institutional Onslaught

If the ongoing trend of institutional accumulation persists, the market could be on the brink of an extreme supply crunch. While fluctuations in Bitcoin’s price may occur, the fundamental scarcity of the asset becomes increasingly evident.

Despite concerns about high fees associated with GBTC, the launch of the Bitcoin ETF is perceived as a significant success.

Łaskarzewski said that the moves by institutional giants such as BlackRock underscore the growing importance of Bitcoin within the traditional finance space.

“In conclusion, BlackRock’s significant withdrawal from the Bitcoin supply within a short timeframe highlights the accelerating pace of institutional adoption. The potential supply crunch emphasizes the growing importance of Bitcoin in the broader financial landscape.”

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