As per the monthly report published by Ark Invest for the month of June, an impressive statistic reveals that almost 70% of the supply of Bitcoin (BTC), or Bitcoin Holdings, remained dormant and unchanged for a duration of at least one year.
During the challenging period known as the crypto winter, which unfolded in the year 2022, a remarkable trend emerged where investors exhibited a steadfast resolve by retaining approximately 70% of the entire supply of Bitcoin. This notable behavior coincided with a noteworthy decrease in the discount associated with the Grayscale BTC, a significant development in the crypto market.
Bitcoin Holdings Reach an All-Time High
In its recently published monthly Bitcoin report, titled “The Dawn of the ETF Era?”, Ark Invest, the renowned investment management firm, sheds light on a significant development in the realm of Bitcoin holdings. According to the report, the quantity of Bitcoin that has been held for a period of one year or longer has achieved an unprecedented milestone, reaching an all-time high.
This noteworthy fact, as emphasized by Ark Invest, highlights the substantial growth in the number of long-term Bitcoin holders. As nearly 70% of the total 19.4 million Bitcoins currently in circulation have remained stagnant for a year or more. This remarkable statistic serves as a concrete affirmation of the strengthening holder base within the Bitcoin ecosystem. Thereby solidifying the cryptocurrency’s enduring appeal and stability in the market.
GBTC Discount Unleashes Bitcoin ETF Surge
Furthermore, it is worth noting that the net asset value (NAV) discount of GBTC has reached its lowest point of the year. The number declined significantly from 42% to 30%. This means that the share price of GBTC currently stands at 30% below the price of the underlying asset. That is none other than Bitcoin.
The downward trend in the discount began in mid-June, coinciding with the filing of a spot Bitcoin ETF by BlackRock. That was further followed by other asset managers. This development has played a pivotal role in causing the discount to narrow over time.
In a statement, Ark Invest provided insight into the situation. They suggested that the diminishing discount could be an indication that the market is factoring in the likelihood of a Bitcoin spot ETF receiving approval. This, in turn, increases the probability of GBTC eventually being converted into such an ETF.
Notably, Grayscale finds itself entangled in a legal battle with the Securities and Exchange Commission (SEC). As it seeks to contest the rejection of its application for the conversion of GBTC into a spot Bitcoin ETF.
Conclusion
The monthly report published by Ark Invest reveals two significant developments in the Bitcoin market. Firstly, nearly 70% of Bitcoin holdings have remained dormant for a year or longer. This indicates a strengthening holder base and the cryptocurrency’s enduring appeal.
Secondly, the discount associated with the Grayscale BTC has decreased from 42% to 30%. This suggests that the market is anticipating the approval of a Bitcoin spot ETF. Meanwhile, Grayscale is currently facing legal challenges in its pursuit of converting GBTC into a spot Bitcoin ETF. But the market’s response indicates growing optimism for the future of Bitcoin.
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