Grayscale’s Bitcoin Trust (GBTC) has experienced a decline in withdrawal volumes, with outflows reaching their lowest point in the past few days.
Data from BitMEX Research reveals that on February 23, GBTC recorded withdrawals of $44.2 million, marking the lowest daily volume since its conversion from an over-the-counter product to an exchange-traded fund (ETF) on January 11.
In January, GBTC reported total withdrawals of $5.64 billion, with a significant $640 million leaving on January 22 alone. However, February has seen a decrease in outflows, amounting to $1.8 billion so far. Since its inception, GBTC has witnessed total withdrawals of $7.4 billion.
In comparison, BlackRock’s IBIT has attracted over $6.6 billion in investment since its launch, followed by Fidelity’s FBTC with over $4.7 billion in capital. ARK 21Shares holds the third position, with inflows of $1.4 billion over the same period.
The significant exit from GBTC was expected, as the approval of the spot Bitcoin ETF by the United States Securities and Exchange Commission on January 10 allowed GBTC holders to convert and redeem their shares. Previously, investors had to sell shares on the secondary market to exit their positions.
Analysts suggest that investors have also been rebalancing their portfolios and shifting to Bitcoin ETFs with lower fees in recent weeks. GBTC charges an annual management fee of 1.5%, while other issuers charge as little as 0.19%.
Grayscale’s Bitcoin fund may face another challenge in the form of the bankrupt crypto firm Genesis Global Holdco. The company has been granted court permission to sell $1.3 billion worth of GBTC shares to reimburse investors.
However, the substantial outflows may be offset by Grayscale’s fee structure. “They can have their assets reduced by up to 90% and still make more profit than all other issuers combined,” noted Nate Geraci, the president of ETF Store.