Grayscale Buys Half a Billion Dollars Worth of Bitcoin; Bought 26,150 BTC in Jan
In these last 18 days of January, the world’s largest asset manager Grayscale Investments has bought 26,150 BTC, worth just under $1 billion (at a price of $37,000).
Interestingly, during the same period, only 16,200 BTC were mined, at a rate of 900 BTC per day. This means, in the first half of the first month of 2021, Grayscale’s Bitcoin Trust purchased 161% of all the Bitcoin that was mined.
In total, Grayscale currently holds 632.8k BTC, 3.4% of Bitcoin’s circulating supply.
The biggest purchase made by GBTC was on Monday when the asset manager bought more than half a billion-dollar worth of Bitcoin as it added another 16.24k BTC.
After a 19-day hiatus, Grayscale opened the investments to new institutional investors, and last week on Thursday was when it started buying BTC after Dec. 25. Last week, GBTC bought Bitcoin three days in a row, adding 2.17k, 2.61k BTC, and 5.13k BTC in succession.
— skew (@skewdotcom) January 19, 2021
In Q4 of 2020, Grayscale saw “unprecedented” demand” that hauled in $3.3 bln in new investments, and AUM saw a 10x growth in the entire year, as per the report released last week. 94% of these inflows in Q4 came from institutions.
For now, Bitcoin price remains range-bound after last week’s pullback, despite this demand from Grayscale clients, which mainly consists of institutional investors dominated by hedge funds but also includes family offices, retirement accounts, and accredited individuals.
According to trader Jonny Moe, although Bitcoin can go for a test of $50,000 before a larger pullback as large psychological numbers are of significance, he can't shake off the feeling that “this is going to breakdown and we close the weekly red.”
The good thing for the leading digital asset is that the reserve risk is still very low, which means that there is high confidence among long-term HODLers for a higher price.