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Scaramucci says Bitcoin declined on sales of Grayscale shares, amid FTX unwinding

Scaramucci says Bitcoin declined on sales of Grayscale shares, amid FTX unwinding
Snapshot
Anthony Scaramucci sees several factors behind Bitcoin's recent decline. Credit: Michael Brochstein/SOPA Images/Shutterstock
  • Scaramucci analyses reasons for recent Bitcoin decline.
  • US Security and Exchange Commission explains hack, fake ETF announcement.
  • Vanguard rebuffs spot Bitcoin ETFs.

Scaramucci says Bitcoin fell partly on sales of Grayscale shares

SkyBridge Capital founder Anthony Scaramucci told Bloomberg Television that Bitcoin has declined in value since its spot ETFs began trading on Thursday in part because of sales of Grayscale Bitcoin Trust shares.

“There seems to be of lot of selling of Grayscale,” he said.

Scaramucci added: “The second thing we are seeing is the bankruptcy estate of FTX is unloading into the ETF announcement. There is a heavy volume of selling in Bitcoin right now. I do expect the supply overhang to be done in the next six to eight trading days.”

FTX, which filed for bankruptcy last year, is in the process of selling off crypto assets.

“One last thing, there has been a quiet period. … Wall Street has not been able to market these ETFs and that will start in about eight days as well,” Scaramucci said.

Bitcoin hit a two-year high on Thursday, breaking through $49,000 before falling below $43,000 on Friday. At the time of writing, it was at $42,803.40.

SEC explains hack of X account, fake approval of Bitcoin ETF

The SEC issued a statement explaining the hack of its X account Tuesday that resulted in a fraudulent claim it had approved a spot Bitcoin ETF.

The SEC said an unauthorised party gained control of the phone number associated with its @SECGov X.com account and was able to access it, posting the false announcement that the SEC had approved the Bitcoin ETF.

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About 15 minutes later, officials posted on the @garygensler X.com account that the other account had been hacked and that the agency had not approved trading of spot Bitcoin ETFs. The unauthorised post was subsequently deleted and a new post on @SECGov X.com informed users the account had been compromised.

The SEC noted that it doesn’t use social media platforms to announce its actions to the public, but only to amplify those it has made on its website. The agency subsequently approved the spot Bitcoin ETFs on Wednesday, DL News reported.

The agency is working with federal law enforcement in its investigation of the hack, including the FBI and the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency.

In a bipartisan move, senators Ron Wyden (D-Ore.) and Cynthia Lummis (R-Wyo.) asked SEC Inspector General Deborah Jeffrey’s office to investigate the lapse and report back by February 12.

DL News also reported earlier that a group of Republican congressional representatives led by Patrick McHenry had requested a briefing from SEC Chair Gary Gensler by January 17 on how the security breach occurred and how he will prevent future occurrences.

Vanguard blocks clients from purchasing spot Bitcoin ETFs

Asset manager Vanguard won’t allow customers to buy the new spot Bitcoin ETFs on its platform, CoinDesk reported.

A Vanguard spokesperson told CoinDesk that crypto-related products were not compatible with building “a well-balanced, long-term investment portfolio.”

Vanguard also told Axios: “In addition to spot Bitcoin ETFs not being available for purchase on the Vanguard platform, effective immediately, Vanguard will no longer accept the purchase of cryptocurrency products, including Bitcoin futures ETFs.”

Vanguard had issued a statement in 2022 questioning the long-term sustainability and price volatility of crypto investments.

Crypto market movers

Bitcoin is up 0.07% today at $42,803.40.

Ethereum is up 0.38% today at $2,531.54.

What we’re reading

How VanEck plans to compete with BlackRock for Bitcoin ETF billionsDL News

Bitwise bitcoin ETF draws most inflows on first trading day, company saysReuters

Gary Gensler says SEC decision to approve spot ETFs isn’t an endorsement: ‘Bitcoin, itself, we did not approve’Fortune