As bitcoin falters around the $ 33.500 level, the cryptocurrency could soar higher this week as the highly anticipated Bitcoin Trust (GBTC) unlock on GrayScale approaches.
Why is a bullish breakout of the bitcoin price expected?
Bitcoin's price struggled to find direction in June after plummeting hard in May in the wake of China's renewed crypto crackdown, exacerbated by Elon Musk's shifting attitude towards BTC. The cryptocurrency price, which has fallen nearly 50% from its all-time high in April, successfully held the $ 30.000 support but failed to make significant gains.
Now, with the world's largest digital asset manager, Grayscale Bitcoin Trust expected to unlock giant stocks in July, some investors are watching more cautious strategies in the cryptocurrency markets. For well-known cryptocurrency trader Michaël Van de Poppe, however, Bitcoin is likely to initiate a real "bullish turn" in the coming days.
In his July 12 update, Crypto Michael noted that bitcoin had managed to hold above the weekly EMA of 50. More importantly, the entire support zone is holding up. Therefore, he would not be surprised to see BTC at around $ 38.000 "during the days of this week". In fact, the trader believes the GBTC unlock is bullish for the Bitcoin price. He explained: "It could have a very positive impact on the markets as those holders or investors have to buy spot bitcoins to cover their potential losses that they have when they buy GBTC."
Grayscale Bitcoin Trust has a delayed redemption mechanism whereby GBTC investors are required to hold their shares for six months before selling them. As many investors bought the trust in January, a huge tranche of these shares is expected to be released this month. The biggest release will take place on July 18, when 16.240 BTC will be released. In general, around 40.000 BTC will be unlocked throughout July. This is about $ 1,3 billion, according to quotation BTC of $ 33.510.
While JPMorgan analyst Nikolaos Panigirtzoglou argued last month that GBTC stocks hitting secondary markets would be "another headwind" for Bitcoin's price, there is a growing chorus of bullish calls.
A herd of bulls
Much like Crypto trader Michael, cryptocurrency startup Amber Group expects investors to enter the market to buy BTC in an attempt to repay the loans used to fund their initial GBTC stock purchases.
Additionally, cryptocurrency exchange Kraken recently released a report disputing the narrative that unlocking GBTC poses a downside risk to the price of Bitcoin.
“Despite the release of GBTC shares worth 40K BTC in July, the market structure suggests that the release will not materially weigh on the BTC spot markets anytime soon, if at all, as some have claimed,” Kraken wrote. .
Cryptocurrency exchange FTX CEO Sam Bankman-Fried also suggested that the GBTC unlock "doesn't really matter" to the dormant cryptocurrency. However, the CEO warns that this is not financial advice and anything could happen in the bitcoin market.
