BlackRock’s Bitcoin Holdings Officially Surpasses Grayscale: What Next for BTC Price?

Blackrock’s iBIT ETF Hits Major Milestone

While Bitcoin price consolidates around $60,000 on August 20, 2024, on-chain data reveals that BlackRock has surpassed Grayscale in Bitcoin holdings. This shift marks a significant turning point in the Bitcoin ETF sector.

BlackRock Flips Grayscale in Bitcoin AUM

BlackRock, the world’s largest asset manager, has reached a crucial milestone in the digital asset space. According to recent data, BlackRock’s digital asset-focused exchange-traded funds (ETFs) have outpaced Grayscale Investments in total assets under management (AUM).

Specifically, BlackRock’s Bitcoin holdings have surged by over $723 million in August alone, with total BTC AUM hitting $21.6 billion.

This includes $21.1 billion in Bitcoin assets, significantly surpassing Grayscale’s $16 billion. The Arkham Intelligence chart underscores BlackRock’s growing dominance, showing a continuous upward trend in its Bitcoin reserves.

This shift is notable as it reflects the growing influence of traditional financial institutions in the cryptocurrency market. BlackRock’s dominance is highlighted by an Arkham Intelligence chart, showing a continuous upward trend in its Bitcoin reserves, contrasting with Grayscale’s more stabilized holdings.

The implications of this are significant. BlackRock’s ETFs provide a familiar investment structure, potentially drawing more traditional investors to Bitcoin. This could also influence future regulatory decisions regarding Bitcoin spot ETFs.

As BlackRock gains ground, Grayscale may need to innovate to maintain its competitive edge, signaling a broader shift in how institutional investors approach digital assets.

Grayscale (GBTC) Has Bled 360,000 BTC Since January

The decline in Grayscale’s dominance can be traced back to a steady outflow of funds from its Bitcoin ETFs, a trend that accelerated with the launch of 10 new ETFs in January 2024.

Historically, Grayscale’s ETFs commanded high fees, which initially limited the entry of competitors. However, as new ETFs entered the market with lower fees and greater flexibility, investors began moving their assets away from Grayscale.

As of August 2024, Grayscale’s Bitcoin holdings have plummeted from 624,000 BTC in January to just 264,000 BTC, reflecting a significant loss of investor confidence.

The Arkham Intelligence chart starkly illustrates this dramatic decline. Contributing to this outflow, major institutions such as Morgan Stanley and Goldman Sachs have significantly reduced their GBTC holdings in favor of BlackRock’s IBIT.

Morgan Stanley, for instance, has almost fully liquidated its $269.9 million GBTC position, now holding 5.5 million shares of IBIT worth approximately $187.1 million. Similarly, Goldman Sachs has reported holdings of nearly 7 million IBIT shares, valued at about $235 million, while retaining smaller positions in Grayscale’s converted funds.

Nate Geraci, president of The ETF Store, highlighted on social media platform X that IBIT has experienced only one day of net outflows since its launch. Supported by data from SoSoValue, IBIT has seen 26 days of zero net inflows or outflows, reflecting strong investor confidence.

Meanwhile, BlackRock’s spot Ethereum ETF, ETHA, ranks as the third-largest fund by AUM. Since its launch on July 22, ETHA has recorded no negative outflows, though it has had four days of net-zero trading.

Bitcoin Price Forecast: Major Roadblock at $62,000

The current Bitcoin price action is facing a critical resistance level at $62,000, as highlighted by the Bollinger Bands and Parabolic SAR in the technical chart. The Bollinger Bands indicate that the price is nearing the upper band, suggesting potential resistance. This is further corroborated by the Parabolic SAR, which signals a possible reversal if Bitcoin fails to break above this level.

On the downside, the $59,300 level acts as immediate support, as indicated by the lower Bollinger Band. A break below this level could see Bitcoin testing the $54,400 support, where the middle Bollinger Band converges with the Parabolic SAR.

In conclusion, while Bitcoin has shown resilience in its consolidation phase, the key to breaking the $62,000 resistance will be sustained bullish momentum. Without it, the risk of a pullback to the $59,300 support level remains high, potentially setting the stage for a deeper correction towards $54,400.