The sudden and significant drop in Bitcoin’s price below the $55.5k level can be attributed to a wave of institutional sell-offs over the past month, creating uncertainty in the cryptocurrency market.
Notably, BlackRock remains the only major player not participating in the recent sell-off; other prominent institutions like Fidelity, Ark Invest, Grayscale, and Ceffu have offloaded substantial amounts of Bitcoin, causing significant downward pressure on prices.
Bitcoin Price Action & Unemployment Rate
The current trade price of Bitcoin (BTC) is $54,702 & this price is 20% down over the last 3 months trade price.
In the trade price graph we can see that the trade price of Bitcoin crashed rapidly in the last 1 hour. It is because the USA labor department announced unemployment rate data. According to the release data, the local employers added 142,000 new jobs in August, which was lower than the anticipated 160,000+.
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Institutional Sell-Off Data
Since the Bitcoin price bottomed in August to early September 2024, several key institutional investors have been selling large portions of their Bitcoin holdings:
-Fidelity has sold a staggering 16,000 BTC, valued at approximately $915 million.
– Ark Invest has offloaded 7,000 BTC, amounting to $400.4 million .
– Grayscale , known for its Bitcoin Trust, has sold 15,000 BTC , worth about $858 million .
– Additionally, Ceffu (a cryptocurrency custody platform) has sold 3,124 BTC in just the past week, valued nearly $178 million.
This heavy selling pressure has resulted in a sharp decline in Bitcoin prices, driving it below the $55.5k support level, triggering widespread concern among retail and institutional investors alike.
Bitcoin Spot ETF Traders Join the Exodus
The institutional sell-off was compounded by a net outflow from Bitcoin spot Exchange Traded Funds (ETFs). On September 5 , the Bitcoin spot ETF market experienced a net outflow of $211 million , marking the seventh consecutive day of outflows :
– Grayscale’s Bitcoin Trust (GBTC) alone witnessed an outflow of $23.2175 million .
– Fidelity’s Bitcoin ETF (FBTC) suffered an even more severe outflow, totaling $149 million .
– Bitwise’s Bitcoin ETF (BITB) followed suit, recording an outflow of $30 million .
The consistent exit of capital from Bitcoin spot ETFs has placed further strain on the market, leading to the plummeting prices.
Total Net Asset Value Decline
As a result of the continuous selling and outflows, the total net asset value of Bitcoin spot ETFs has dropped to $50.727 billion , a sharp decline from previous levels. The fear of further liquidations has created a snowball effect, contributing to the current bearish sentiment and market volatility.
BlackRock’s Absence: A Notable Outlier
Interestingly, BlackRock , the world’s largest asset manager, has remained notably silent during this institutional sell-off. Unlike other major financial institutions, BlackRock has neither sold nor added to its Bitcoin position in recent weeks, leading to speculation regarding the firm’s long-term strategy. With BlackRock’s anticipated launch of a Bitcoin Spot ETF still in the pipeline, many industry insiders believe the firm may be waiting for better conditions or timing its entry to avoid the current volatility.
Read also: WazirX Makes Progress in Recovering Funds: $113K of Stolen Crypto Frozen from $234 Million Hack
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