Grayscale plays a vital role in BTC price, adaptation and supply as the firm currently owns more than 3% of the total 21 million supply of bitcoin.
Leading digital asset manager Grayscale continues to tighten its control over bitcoin supply. According to recent estimates, the company currently owns more than 3% of the 21 million BTC that will exist.
Grayscale’s BTC Dominance
Released in 2013, Grayscale is the largest cryptocurrency asset manager with more than $ 27 billion in assets under management.
As somewhat expected, the company’s Bitcoin Trust (GBTC) is the most popular product that provides corporations indirect investment in BTC through a public fund reporting to the US Securities and Exchange Commission (SEC). Investors often pay a premium without worrying about storing and managing assets.
GBTC’s popularity exploded last year as institutions were more willing to join the field. Grayscale reported that AUM jumped 10 times in 2020. What’s more, the firm only raised more funds in Q4 2020 than 2013-2019 combined, and BTC was at the forefront.
Investors who allocate funds to GBTC buy shares in a fund that Grayscale supports as a bitcoin holder. And the company purchased a large amount of BTC over the past year to keep up with rapidly increasing demand.
The asset manager wrote in his Q4 2020 report that “as a result of the halving in May 2020, the newly created Bitcoin supply slowed down, while entries into Grayscale accelerated significantly.” In fact, the firm said it has purchased nearly twice as many bitcoins as has been mined since the prize halving.
How much bitcoin does Grayscale have?
Recent reports have exposed Grayscale’s BTC trading craze. Tracking source Bloqport said the asset manager purchased 16,244 BTC in 24 hours. This substantial amount makes about 600 million dollars in USD.
Finally, Bloqport stated that Grayscale’s bitcoins under management accounted for 3% of all BTC in existence so far. Company data confirm this.
According to Grayscale’s website, GBTC owns 666,675,200 shares outstanding with 0.00094919 BTC per share. With simple math, we can see that this amount is equal to 643.801 bitcoins. This corresponds to 3.013% of the total supply of 21 million. Moreover, it is possible to say that at the time of writing these lines it is 3.40% of all 18,604,000 bitcoins in circulation.
How important is GBTC for bitcoin price?
Analysts of JPMorgan Chase & Co, the US giant multinational investment bank, have repeatedly emphasized the importance of Grayscale Bitcoin Trust on asset performance and adoption.
Strategists said in their latest report that the cryptocurrency must exceed $ 40,000 to avoid a correction that could divert institutions from investing in GBTC.
Moreover, they stated that the Foundation should maintain purchases of at least $ 100 million per day for the next few weeks to avoid such withdrawal.