Bitcoin News: Here’s Why Institutions are Dumping BTC

Key Insights:

• The latest Bitcoin news covers GameStop offloading its Bitcoin holdings on Coinbase Prime at a loss. Bitcoin ETFs just concluded a week of sustained outflows.
• Precious metals (Gold and silver) extend their rise into uncharted territory, signaling flight to safety.
• Why does the market seem to be in a silent panic mode, and why does the Japanese bond market worsen?

If you have been keeping up with Bitcoin news this week, you likely noticed weak demand and rising uncertainty. This manifested in its price action despite its recent discount.

According to the latest crypto news, institutions have been contributing to the suppressed price action. Recent reports revealed that GameStop just moved its entire BTC holdings to Coinbase Prime.

GameStop reportedly acquired 4,710 BTC in May last year for just over $504 million, at an average price of $107,900 per BTC. This means the company will lose over $81 million if it sells at the current Bitcoin price levels.

Most institutions move their coins to Coinbase Prime to sell. However, it is also possible that the move was for custodial reasons. Meanwhile, the move reflects recent institutional activity.

Bitcoin ETFs just concluded a streak of negative flows this week. The ETFs segment recorded over $1.32 billion in Bitcoin outflows over the last 5 days.

We previously highlighted that the Bitcoin price retested a key short-term support level after its recent dip. However, demand has so far failed to take over as liquidity favored precious metals.

Gold price is currently closing in on the highly coveted $5,000 price tag, while Silver just topped out above $103. The rising prices of precious metals indicated that investors were still seeking the safety of these commodities.

Investors have historically hoarded gold during periods of uncertainty. The metals have been rallying during the recent geopolitical tensions, even though things have somewhat cooled down for now.

Nevertheless, investors continued to buy the precious metals as the preferred asset class. That’s because they were already more appealing. Bitcoin news analysts believe that the gold and silver rally may still offer insights into the Bitcoin price outlook.

Historic pricing data revealed that the Bitcoin price tends to rally after a bullish gold phase. This tracks with the fact that the precious metal prices were already overheated and could be due for profit-taking.

Liquidity flows from gold will likely go to discounted assets. Bitcoin could be among the assets that will absorb that liquidity.

Japanese Bond Market Flashes Red, Highlighting More Risk Ahead

Investors have also been evaluating macroeconomic risks beyond geopolitics. Japan has increasingly been on the radar amid pressure on its bond market.

The Japanese bond market is likely one of the main reasons why crypto investors have been leaning more towards caution. This is because Japanese Government bond yields have been rising aggressively, causing negative pressure for risk-on investments.

Higher bond yields signal rising risk in the bond market and also highlight the state of the economy. Declining confidence in the Japanese bonds risks triggering another Yen carry trade unwind. The last time the Yen carry trade situation occurred, investment markets experienced heavy liquidity outflows.

This risk continues to hover over investors like a dark cloud. It could be among the key reasons why investors currently prefer exposure to gold and silver over alternative assets like Bitcoin. These concerns will likely continue to influence liquidity flows across the market, as per Bitcoin news analysts.