Huge Bitcoin withdrawals raise big questions surrounding the upcoming ETF

A gigantic outflow of Bitcoin (BTC) was recently observed at the crypto exchange Coinbase. There is increasing speculation that this activity is preparations for the approval of a Bitcoin exchange fund (ETF).

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Large Bitcoin outflow on crypto exchanges

In the last few days, up to 30,000 Bitcoin have left the American stock exchange. The move represents the largest outflow since May, in both Bitcoin and the US dollar.

The exact reasons for this outflow are not entirely clear. It can be a sign for large investors, often referred to as β€œwhales‘ who move their Bitcoins to more secure storage.

This could indicate expectations of price stability or a long-term strategic move.

Another possibility is that institutional investors are preparing for new investment opportunities, such as a Bitcoin ETF.

Speculation about Bitcoin exchange funds

The moves on Coinbase have sparked a lot of speculation in the crypto community. Many are wondering if this is an indication of big developments to come.

Coinbase is the custodian for 9 of the 12 parties looking to launch a Bitcoin ETF. This means that the Bitcoins are held for parties such as BlackRock and other applicants.

It remains to be seen whether Coinbase’s recent Bitcoin outflows are actually related to preparations for ETF approval or whether other factors are at play.

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According to blockchain analytics platform Glassnode, the outflow was also observed on other exchanges. On Wednesday, up to 28,000 Bitcoin flowed from major exchanges.

This represents the largest outflow in a single day since December 14, 2022. Coinbase had the largest share of this. Of the 28,000 BTC, 18,000 flowed from Coinbase.

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Will the Bitcoin ETF bring a decline first?

The first ETFs are expected to be approved in January 2024. Although this is an extremely positive development according to analysts, its arrival could initially trigger a significant correction.

However, the ETFs can ensure an increase in the long term. Read here 5 reasons why the Bitcoin ETF can reach a price of $100,000.

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