Did Grayscale push Bitcoin back up to the $40K mark?

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Within 48 hours of Grayscale reopening its services to new investors on Jan. 13, Bitcoin’s price soared nearly 20%, again just below the $ 40,000 mark.

During the same period, the institutional investment firm expanded its portfolio by 4,618 BTC to a current value of $ 182 million. Including $ 3.3 billion in revenue last quarter, which is mostly BTC, Grayscale’s crypto portfolio stands at $ 27.6 billion.

Bitcoin isn’t the only coin to see strong support since Jan 13th. The entire crypto market added $ 137 billion to once again grow beyond a $ 1 trillion market cap.

Grayscale is back! Grayscale received another 2172 #BTC within 24 hours. Their total AUM is now $ 26.39 billion.
https://t.co/r1tmKT6a3r pic.twitter.com/lZlcJdNvTk

– Bybt (@bybt_com) January 14, 2021

With the increasing demand from institutional investors, the available supply of Bitcoin is becoming increasingly scarce. Yesterday, the major exchange eToro announced to users that it was facing liquidity issues for its crypto platform and warned that it could restrict margin trading and buy orders over the weekend to deal with it.

Since Bitcoin was halved late last year, around 900 BTC has been mined every day. According to the crypto analysis platform Glassnode, however, only a third of this has actually been sent to exchanges on average since July 2020.

In the same period, Grayscale bought around 224,930 Bitcoin, which is more than 1,200 BTC per day. Without considering other institutional investors, the available supply quickly dries up.

Not all statistics suggest that institutional investors are central to the price of crypto, as Grayscale’s Ethereum Trust didn’t get the same amount of interest over the last month. The balance has decreased by 6036 ethers since December 9, when it hit an all-time high of 2.94 million ETH. During that period, Bitcoin rose 116%, but Ethereum rose more than 122%.