(Bloomberg) — Bitcoin’s decline since exchange-traded funds holding the cryptocurrency began trading has been driven in part by sales of Grayscale Bitcoin Trust shares, according to SkyBridge Capital founder Anthony Scaramucci.
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“There seems to be a lot of grayscale selling,” Scaramucci said during an interview with Bloomberg Television on Friday.
The hedge fund manager said his trading desk indicated that holders of shares, which were transferred from a trust this week when the U.S. Securities and Exchange Commission signed off on ETFs, were selling for book losses and switching to lower-fee alternatives.
Selling one bitcoin product to buy another shouldn’t affect the price of bitcoin, said Zach Bandel, managing director or research at Grayscale. The potential approval of Bitcoin exchange-traded funds has been a topic of discussion since Grayscale’s victory in court last summer. He said that after the sharp rise in Bitcoin valuations, it is normal to see some profit-taking in the asset.
GBTC, which has been around since 2013, recorded $2.3 billion in trading volume on Thursday, the largest first-day turnover ever for an ETF. It has been one of the most popular channels to learn about Bitcoin. On Thursday, the native cryptocurrency surpassed $49,000, hitting its highest level in two years. It fell below $43,000 on Friday.
GBTC shares fell 5.2% to $38.58 on Friday. It rose more than 300% last year, compared to a roughly 160% increase for Bitcoin.
“The second thing we’re seeing is FTX’s bankruptcy case being unpacked in the ETF announcement,” Scaramucci said. “There is a significant amount of selling in Bitcoin right now. I expect it to be oversupplied over the next six to eight trading days.
FTX, which was one of the largest cryptocurrency exchanges, filed for bankruptcy in 2022 along with a wave of major cryptocurrency companies amid the market collapse. It still holds large amounts of crypto assets and is in the process of being dismantled.
“One last thing, there’s been a quiet period on Wall Street. Wall Street hasn’t been able to market these ETFs and that’s going to start in about eight days,” Scaramucci said.
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