In a recent statement that sent shockwaves through the cryptocurrency market, famous pro-Bitcoin advocate “InvestAnswers” used X to reveal surprising information about BlackRock’s significant Bitcoin purchases. The statement triggered concerns among market participants about a possible supply shortage on the horizon.
BlackRock is rapidly accumulating Bitcoin
According to post X, BlackRock, a global heavyweight in asset management, recently absorbed a staggering 11,500 BTC in just two days. This purchase, equivalent to approximately 13 days of Bitcoin production, triggered alarms within the crypto community, considering that approximately 900 BTC is being issued per day. The tweet also highlighted the scale of BlackRock’s move, noting that the 11,500 BTC withdrawal represents approximately $500 million in Bitcoin’s current market cap. The size of BlackRock’s accumulation raises questions about its potential impact on the leading cryptocurrency’s overall supply dynamics.
Digging deeper into the data revealed that BlackRock’s spot ETF accounted for only 25% of total Bitcoin ETF volume during the same two-day period. This information led to an estimate that a total of 46,000 BTC was removed from the market during this time period. The analysis reveals a broader trend of significant Bitcoin accumulation through ETFs. Extrapolating these figures, the accumulation rate for US ETFs alone would be 25.56 times daily production, assuming a daily withdrawal rate of 23,000 BTC. The Bitcoin analyst behind the post warned that if this trend continues, the market could be headed for a serious supply shortage. This could have profound effects on Bitcoin’s price trajectory.
Conclusion: What will happen now?
An eagle-eyed commenter on post The commentator noted that Coinbase, a custody platform for Bitcoin ETF issuers, reportedly owns a significant $7 billion worth of Bitcoin in the OTC market.
This perspective suggests that the impact of Bitcoin’s continued hoarding by institutions may not be immediately apparent in the market. The strategic use of OTC trading by BlackRock and other major players implies a nuanced approach to managing Bitcoin assets and can potentially soften the short-term impact on market dynamics. The cryptocurrency community is now closely monitoring market reactions to BlackRock’s significant Bitcoin purchases. While concerns about supply shortages remain, some investors remain optimistic about the potential positive effects on Bitcoin’s value.
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