It is no longer news that Grayscale’s Bitcoin Trust is planning to unlock some of its Bitcoin holdings sometime later in this month. While the firm is yet to release further information about the unlocking, many crypto analysts and experts alike have expressed their concerns about how this event could affect the digital market space.
However, despite the concern of others, crypto trading firm, QCP Capital, does not share the fear of others, instead the company believes that the unlocking would have no adverse effect on the price of Bitcoin. This was contained in a recent report released by the firm.
According to the firm, this is not the first unlocking event being held by Grayscale, though it admitted that this would be the biggest GBTC shares unlocking. It continued that “most of the large institutional positions who had subscribed in-kind before have already been unlocked earlier, and they have held off selling at the current discounted price.”
It also highlighted that “the upcoming unlocks are for institutional holders who subscribed directly to GBTC 6 months ago – and this batch consists of all the new Q1/2021 positions, largely ARK’s last tranche.” Thus, they do not see how this unlocking would have a negative effect on the market.
It would be recalled that GBTC shares have been trading at the negative for a while now, this has forced many holders to stop selling their shares in the hope that it could start trading at the premium again.
Why Analysts Predicts GBTC Shares Unlocking Would Affect Market Negatively
It is expected that in the middle of this month, Grayscale would make over $500 million of its GBTC shares which translates to 16,240 BTC available to its investors. Investors would then have the liberty to either sell or hold their assets.
Should they choose to sell, many analysts predict that this would cause a downward pressure on the value of Bitcoin and that of GBTC. This could cause the price of BTC to further nosedive as the pressure increases.
Many of them are basing their predictions on the current FUD being spread across the market by Tesla’s decision to stop accepting the digital gold alongside China’s renewed hostilities towards Bitcoin mining.