Building on CryptoSlate’s recent analysis of the competing Bitcoin inflows and outflows between BlackRock and Grayscale, I extrapolated the data even further to see just how long BlackRock could sustain its current average Bitcoin accumulation.
At a high level, BlackRock’s entry through Bitcoin ETFs is a substantial moment for Bitcoin’s reputation in the United States. Along with the other ‘Newborn Nine‘ ETFs, BlackRock’s endorsement is likely to decrease the liquid and very liquid supplies as more investors gain access to Bitcoin as a long-term investment. Further, it will increase investor confidence for those unfamiliar with blockchain and enhance the credibility of Bitcoin as an asset class, thereby affecting its liquidity and volatility profiles.
Before I go any further, I want to add a very clear disclaimer here. The analysis below is a hypothetical look at possible accumulation levels from spot Bitcoin ETFs. I have used the debut inflows for BlackRock as the yardstick. There is no guarantee these levels will persist, and if they did, it would very likely result in an increase in the price of Bitcoin. The demand for Bitcoin is unlikely to remain consistent at any price, so assuming the same BTC inflows over a prolonged period is improbable.
That said, looking at the numbers from a purely theoretical standpoint does reveal some extremely headline-worthy data points, which can then be used alongside other analyses to identify if and when a supply crunch is on the horizon for Bitcoin.
The longer these new ETFs continue to acquire Bitcoin at these elevated levels, the better for long-term HODLers and laser eyes.
In my opinion, now, more than ever, HODLing Bitcoin has a real purpose. The fewer Bitcoins available for purchase inside ETFs, the closer we come to a MOASS (Mother Of All Supply Squeezes) where Bitcoin moons, not because shorts have to cover, but because institutions have to buy Bitcoin on the open market like the rest of the world.
Liquidity in Bitcoin and BlackRock’s immediate impact.
Since the debut of spot Bitcoin ETFs in the US last week, BlackRock has acquired an average of 6,266 BTC daily for a cumulative total of 25,067 BTC as of press time. The total acquired by the Newborn Nine over just four trading days is now at 70,000 BTC ($2.9 Billion.) When we include Grayscale, the total Bitcoin under management is 660,540 BTC ($27.6 billion.)
To understand the analysis, I’ll first outline the buckets used, as defined by Glassnode…
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