Bitcoin Under Siege? Expert Points Finger at ETFs and BlackRock
Is Bitcoin facing a new, institutional-grade attack? A prominent analyst is sounding the alarm, suggesting the very vehicles meant to legitimize crypto—ETFs—might be its latest vulnerability.
The Shadow in the Spotlight
The accusation centers on the potential for concentrated power within the new wave of spot Bitcoin ETFs. While these funds brought a flood of mainstream capital, they also created massive, centralized holdings controlled by a handful of asset managers.
One name keeps coming up: BlackRock. Its iShares Bitcoin Trust (IBIT) has amassed a staggering position, leading some to question whether the 'democratization of finance' has simply created new, too-big-to-fail gatekeepers. It’s the old Wall Street playbook—first they ignore you, then they package you into a fee-generating product.
A Systemic Weakness?
The theory isn't about outright theft, but systemic influence. Could large-scale, coordinated redemptions or derivatives trading linked to these ETF holdings be used to manipulate the underlying Bitcoin market? The expert suggests the plumbing of traditional finance, now hooked into crypto, might be the attack vector.
It’s the ultimate irony: the tools built for adoption potentially becoming weapons for control. The market preaches decentralization while writing checks to the most centralized entities on earth. Stay vigilant—the siege might not be on the blockchain, but in the boardrooms.
Institutional Sell-Off?
A detailed analysis by market expert NoLimit on the social media platform X (formerly Twitter) reveals that, at the time of the stock market opening, BlackRock’s bitcoin exchange-traded fund (ETF) IBIT transferred hundreds of millions of dollars’ worth of Bitcoin into Coinbase Prime wallets.
This timing and location indicate a pattern that institutions often follow when selling their assets. As explained, these coins are not sent to Coinbase Prime merely to remain inactive; they are typically directed there for sale or liquidity management purposes.
NoLimit asserts that when a major player like BlackRock needs to liquidate assets or meet redemption demands, the price of Bitcoin reacts rapidly.
He suggests that this situation reflects a combination of factors: selling related to ETFs taking place during low liquidity, inventory management in anticipation of upcoming volatility, and risk reduction in light of a significant derivatives event.
Bitcoin Faces Sharp Decline
Compounding these concerns, technical analyst OxNobler highlighted further developments that contributed to the recent downturn, detailing significant sell-offs by various trading platforms.
In a rapid succession of transactions, Binance reportedly sold 10,155 BTC, Wintermute let go of 5,354 BTC, Coinbase disposed of 10,113 BTC, BlackRock sold 4,945 BTC, and Kraken moved 4,630 BTC.
Collectively, these actions amounted to over $2.5 billion worth of Bitcoin sold within a mere 30 minutes, raising suspicions of coordinated market manipulation.
According to analysts from Bull Theory, the situation has taken a dire turn, with Bitcoin plummeting by $2,300 and liquidating $66 million in long positions in just 45 minutes.
Against this backdrop, $60 billion has been wiped from the crypto market without any negative news triggering such a drastic shift. This scenario has led them to assert that manipulation continues to be a significant concern within the broader crypto market.
At the time of writing, BTC was trading at $87,340, down slightly more than 30% from its all-time highs set earlier in October.
Featured image from DALL-E, chart from TradingView.com
