Arkham Intelligence has revealed via a post on X that BlackRock, the world’s largest asset manager, is currently selling Bitcoin (BTC) holdings from its exchange-traded fund IBIT rather than buying. The update was accompanied by a visual representation of the transaction flows, indicating a significant move away from the asset by BlackRock.
The crypto market activity tracker stated, “guys I have some bad news, BlackRock is not buying. In fact, they are selling.”
BlackRock’s influence in the crypto sector grew after its launch of a Bitcoin ETF, named iShares Bitcoin Trust Bitcoin Holdings (IBIT). Analysts believe the entity is part of why BTC had a year of the books. However, following Arkham Intelligence’s insight, speculation is growing that the asset manager could be selling BTC in reaction to the coin’s recent market pullback.
BlackRock Bitcoin market activity concerns community
In May 2024, BlackRock reportedly moved a substantial amount of Bitcoin into cold storage, which was perceived by the market as a long-term investment strategy. The move was seen as a bullish signal, as investors rode on optimism that one of the most conservative financial institutions was betting on the longevity of Bitcoin.
However, on December 26, BlackRock made headlines when it reportedly sold $188.7 million worth of Bitcoin, its largest sell-off yet. On the same day, according to multiple sources, the asset manager transferred $1.88 billion worth of BTC to Coinbase wallets. The transactions were carried out in multiple tranches, drawing attention from market watchers.
At the time, it was unclear whether the firm was planning on letting go of the holdings or retain them on the exchange.
One user on X commented on the potential market impact, suggesting that BlackRock’s selling could lead to a short-term bearish sentiment, although long-term investors might see this as an opportunity to buy at lower prices.
Another added to the conversation by saying, “Institutions often sell when they think the market has peaked or for portfolio rebalancing, not necessarily because they’re bearish on the asset.”
Meanwhile, on January 2, BlackRock’s IBIT recorded its largest single-day net outflow, with investors withdrawing $332.6 million, according to data from Farside Investors. The investment vehicle hadn’t seen a negative net investment flow for the next four days up until January 8, where outflows peaked $100 million.
BTC ETF Flow chart. Source: Farside Investors.
The IBIT, which holds the title of the largest Bitcoin ETF with approximately $56.2 billion in net assets, has been a dominant player in the cryptocurrency market. The ETF attracted over $37 billion in inflows, which analysts believe contributed to Bitcoin’s rally to a new all-time high of over $108,000 in December.
BlackRock: Bitcoin supply can be changed
In other news, BlackRock released an explainer video that questions the immutability of Bitcoin’s 21 million supply cap. The video, which gripped the community’s attention after being shared by MicroStrategy’s Michael Saylor, describes Bitcoin’s supply limit as a “hard-coded rule” designed to control supply, preserve purchasing power, and prevent the excessive issuance of currency.
JUST IN: BlackRock releases 3 minute educational video explaining what #Bitcoin is. pic.twitter.com/EjqBbV0GRn
— Bitcoin Magazine (@BitcoinMagazine) December 17, 2024
“There is no guarantee that Bitcoin’s 21 million supply cap will not be changed,” the explainer outlined. The video’s implications have sparked debate over whether BlackRock’s growing influence in Bitcoin could lead to the cryptocurrency being “hijacked.”
Joel Valenzuela, a sales and marketing executive for the cryptocurrency Dash, suggests that such messaging is preparing the public for a potential supply cap increase.
“They’re getting everyone used to this eventuality,” Valenzuela noted. “When the supply cap increase happens, it will have ‘always been part of the plan.” And today, in 2024, people have the audacity to say Bitcoin wasn’t hijacked.”
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