Bitcoin’s price has undergone a significant change amid increasing selling pressure, with bears in control of BTC. Grayscale, the asset manager overseeing the Grayscale Bitcoin Trust (GBTC), plays a notable role in this development.
Since the inception of spot Bitcoin exchange-traded funds (ETFs) trading on January 12, Grayscale has been actively selling, evident in substantial transfers of BTC to the US-based cryptocurrency exchange Coinbase.
Bitcoin’s Value Faces Strain Amid Ongoing Grayscale Selling Spree
As per Akrham Intelligence data, beyond the previously mentioned 69,994 BTC ($2.9 billion) transfers, Grayscale executed an additional transfer of 8,593,075 BTC (roughly $335.19 million) to the exchange on Tuesday. This implies the potential for additional selling activities.
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These developments have impacted the trajectory of Bitcoin’s price, witnessing a significant downtrend with a 20% decline over the past week and a half.
On Tuesday, the primary cryptocurrency experienced a drop to as low as $38,500, exerting substantial pressure on a pivotal support level. Despite the prevailing bearish pressure, the $38,500 support level has demonstrated resilience thus far, with the cryptocurrency bouncing back to $39,300 at the time of writing.
However, the duration of Grayscale’s ongoing selling activities remains uncertain. If market sentiment continues to sour, there is a potential for Bitcoin to revisit the $30,000 threshold. This level is just above the critical $29,000 mark that marked the inception of the bull run, propelling Bitcoin to its 22-month high of $49,000 on January 11th.
Bearish Momentum Gaining Traction
If the selling pressure from Grayscale and profit-taking cause the $38,500 threshold to falter, market observers should closely monitor the $37,750 level as the next resistance.
A failure to maintain support above this level could pave the way for a potential decline towards the major resistance at $35,600, acting as a barrier against a dip to the subsequent support level at $33,000.
However, in the scenario where these support levels are breached, and the Bitcoin price sustains its downtrend, the next crucial levels to observe for potential bullish momentum would be $29,000 to $30,000. A breakdown beneath these levels could indicate the end of the current bull market structure, providing bears with an advantage in the mid-term, at least until the anticipated halving event in April.
Historically, halving events have served as significant catalysts for the Bitcoin price, as demonstrated in their influential impact.
As the Bitcoin market contends with heightened selling pressure and Grayscale’s continuous selling activities, market participants exercise caution regarding the potential for a substantial price downturn. The upcoming days and weeks will play a pivotal role in determining whether Bitcoin can reclaim its bullish momentum or succumb to further downward pressure.
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