A surge of 3% in the overall market cap of cryptocurrencies indicated a widespread market upturn, as Bitcoin managed to withstand decreased selling pressure stemming from Grayscale GBTC ETF outflows.
Bitcoin’s rally above $41,000 on January 26th boosted market confidence, leading to price increases for numerous cryptocurrencies. CoinMarketCap reported that around 10 tokens experienced double-digit price spikes within the last 24 hours.
Among the tokens, Bitcoin’s BRC-20 token 1000SATS (SATS) saw a remarkable 21% surge. Conflux (CFX), often referred to as ‘China’s Ethereum’, followed with a gain of over 15%, while Ethereum Name Service (ENS) closely trailed with a 14% increase.
Conflux made headlines with the announcement of a Bitcoin L2 launch anticipated by mid-year, while ENS received praise from Ethereum co-founder Vitalik Buterin in early January.
Other notable performers on January 26th included Akash Network (AKT), Optimism (OP), Near Protocol (NEAR), Bonk (BONK), ORDI, Chiliz (CHZ), and OKB.
The top gainers on January 26th, as reported by CoinMarketCap, showcased the positive momentum in the market.
Market analysts at JPMorgan indicated that the consecutive negative net flows for Grayscale’s GBTC exchange-traded fund might be slowing down, as reported by crypto.news. It was suggested that profit-taking, likely from arbitrageurs capitalizing on GBTC’s net asset value discount, had led to approximately $3 billion in outflows.
FTX, under the leadership of CEO John J. Ray III, also unloaded around $1 billion worth of Grayscale converted Bitcoin ETF, contributing to over $4 billion in outflows from GBTC in just over two weeks. Bloomberg’s expert Eric Balchunas predicted a 25% decrease in Grayscale’s BTC ETF market cap, which currently holds over $20 billion in value.
The shift towards ETFs with lower fees may have played a role in this trend, with Grayscale charging a high fee of 1.5% compared to competitors offering fees as low as 0.21% to 0.35% after fee waivers.
The evolving dynamics in the crypto market, including the impact of Grayscale’s GBTC ETF outflows, continue to be closely monitored by industry observers.