BlackRock's IBIT ETF Nears GBTC Overtake Post-Bitcoin Halving: Bloomberg Analyst

Bloomberg Analyst Predicts BlackRock's IBIT to Surpass GBTC by Month-end

According to Bloomberg Intelligence analyst Eric Balchunas, BlackRock's iShares Bitcoin Trust (IBIT) is poised to surpass the Grayscale Bitcoin Trust (GBTC) by the end of April. Balchunas highlighted on Twitter that GBTC currently maintains a lead of $2.3 billion over IBIT, with an anticipated close competition by April 30.

For context, just a week ago, the disparity between the two prominent spot Bitcoin ETFs in the U.S. stood at around $4 billion.

IBIT, positioned as a contender to dethrone Grayscale's long-standing fund, has been the subject of speculation since its approval. GBTC, which commenced trading in 2013, was initially accessible only to accredited and institutional investors. Despite its assets under management reaching over $43 billion in November 2021, the fund experienced a significant decline to below $10 billion amidst market turbulence a year later. Following the approval by the U.S. Securities and Exchange Commission in January to convert GBTC into a spot Bitcoin ETF, its assets amounted to $28.6 billion. However, GBTC's AUM has since decreased to $19.5 billion as investors migrated to alternative ETFs offering lower fees.

Earlier this month, Grayscale CEO Michael Sonnenshein attributed the decline in GBTC's value to selling linked to the bankruptcies of firms like FTX, suggesting that this phase has largely passed.

It's important to note that the value of Grayscale's assets fluctuates with Bitcoin prices. Despite a recent stabilization in the Bitcoin price following an all-time high last month, BTC has surged by 35% since January 11, now trading at just above $63,000.

Source: Coinglass

This pullback from the peak has led to three consecutive days of outflows for Bitcoin ETFs, with approximately $58 million worth of shares redeemed yesterday alone, as per Coinglass data. Over the three-day period from Friday to Tuesday, totaling $149 million in outflows, traditional markets being closed on weekends.

As Bitcoin traders await the impact of the upcoming halving event, which is expected to reduce the reward for Bitcoin miners from 6.25 to 3.125 BTC, the current projection places the event late on Friday, April 19. This shift in timing disappoints enthusiasts anticipating a combined celebration of Bitcoin and marijuana on 4/20.

In conclusion, while the Bitcoin market experiences fluctuations and anticipation surrounding events like the halving, the competition between IBIT and GBTC reflects evolving investor preferences within the cryptocurrency landscape.