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16K BTC Will Be Unlocked On Grayscale. Is There a Reason to Worry?

  • 16,000 BTC is set to be unlocked by the Grayscale Bitcoin Trust in July.
  • Crypto enthusiasts are paying close attention amid swirling rumours that volatility might shoot through the roof.
  • Historically, the month of July has been particularly bullish for bitcoin and things could easily go either way for Bitcoin.
  • The Grayscale Trust is reported to own around 654,885 Bitcoin and more impressively, 46% of the 1.4 million BTC of listed companies.

Bitcoin is set to undergo a defining moment in the third quarter of 2021, as around 16,000 BTC are set to be unlocked by the Grayscale Bitcoin Trust. According to crypto enthusiasts, the impact of this move from Grayscale will trigger massive spasms of price volatility for the largest cryptocurrency on the market. 

As bitcoin hovers at around the $30,000-$40,000 range, it will be interesting to see how unlocking 16K BTC will affect the price of the cryptocurrency.

Grayscale’s Influence: 16,000 BTC – Cause for Worry?

Grayscale stands as a behemoth in the cryptocurrency ecosystem because of the huge amount of assets in its possession. Launched in 2013, the Grayscale Bitcoin Trust has grown to hold around 654,885 BTC, which amounts to around 3% of the total Bitcoin in circulation.

One rule regulating the relationship between investors and the trust is that they must lock their bitcoin in the trust for 6 months before the asset can be assessed.

The trust is set to unlock around 16,000 BTC, with a significant portion to be released to investors on July 18th, 2021. 16,000 BTC holds a value of around $650 million, and while it is uncertain whether or not investors will dispose of their assets, the sheer volume of the unlocked BTC is bound to affect Bitcoin’s volatility.

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Bitcoin and July – Two Peas in a Pod

Historically, July has always been a bullish month for Bitcoin, and enthusiasts of the cryptocurrency will certainly be hoping that history repeats itself after going through a period of lacklustre performance in June. According to Bybt, July of 2020 was the best of recent years as it marked the start of the bull market.

Following the declarations made by Elon Musk about Bitcoin’s environmental impact and the decision to halt the acceptance of bitcoin as a method of payment, the price of Bitcoin fell drastically. 

The lock-in of the Bitcoin Taproot Upgrade has offered a glimmer of hope to investors, but the upcoming release of 16,000 BTC, worth around $650 million, leaves hopes of a  July boom hanging in the balance, amid fears of increased volatility.

On the Flipside

Where Bitcoin Stands

The month of June has been below par for the world’s largest cryptocurrency, characterized by falling prices and unsavoury news. Trading at $32,335, bitcoin has fallen by over 7% over the last day, and in the last 7 days, its value has fallen by over 19%.

This decline has also been reflected in its market capitalization, which fell by 6.60% to settle at $607 billion. Despite bearish sentiments, trading volume over the last 24 hours is up by 43.15% at $49.6 billion.

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    This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

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    Author

    Milko Trajcevski has been in the crypto world for years, and as such has gathered both a skill for writing as well as a native prowess when it comes to understanding everything that occurs within that world. Through skilled writing and determination, he covers articles about cryptocurrency, tokens, blockchain, crypto-asset regulations, crypto wallets, exchanges, liquidity, DApps, forks, mining, security, and blockchain technologies. He is a professional with a track record of proven expertise within the crypto space.