Grayscale's Bitcoin Spot ETF Daily Outflow Reaches IDR 10.1 Trillion

Liputan6.com, Jakarta – Outflows from Grayscale's Bitcoin Spot ETF product recorded a record daily outflow of USD 642.5 million or the equivalent of IDR 10.1 trillion (assuming an exchange rate of IDR 15,720 per US dollar) on Tuesday, March 19 2024 according to data from BitMEX Research. This outflow occurred when the price of bitcoin fell by around 4%.

Investors have been shedding their holdings in the Grayscale fund since it converted into an ETF on Jan. 10. Meanwhile, money has flowed into nine new spot bitcoin ETFs approved by the US Securities and Exchange Commission (SEC) on the same date.

Outflows from the Grayscale ETF brought total outflows to around USD 12 billion or equivalent to IDR 188.6 trillion since January 10, although a 52% rise in bitcoin prices has helped offset some of the losses.

In a statement, Grayscale said the company anticipated shareholders would gain, arbitraged and liquidated shares to pay back creditors, and this would result in outflows.

Grayscale CEO Michael Sonnenshein told CNBC the company will cut its funding costs over time. The current 1.5% fee is much higher compared to the other nine ETF providers. Their fees come to around 0.25% although temporary relief often brings the fees down to zero.

Head of research at VettaFi, a market analysis firm, Todd Rosenbluth said Grayscale as the largest and most expensive bitcoin ETF currently, profit-taking and redemptions are understandable.

“Money won't flow into this ETF day after day. It makes sense for people to take profits after a strong move,” said Todd, quoted from Yahoo Finance, Wednesday (20/3/2024).

Most other bitcoin funds saw muted inflows or little net change in their assets. The lack of new purchases, combined with Grayscale outflows, made Tuesday the lowest day for bitcoin ETF flows since late January.

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