Cryptoverse opinions are currently divided. Shock news, right?

This time, it’s whether mid-July unlocks of Grayscale Bitcoin Trust (GBTC) shares will dump, pump or nuthin’burger the price of Bitcoin.

What’s GBTC?

Grayscale is the world’s largest digital asset manager, and its Grayscale Bitcoin Trust holds about 654,600 Bitcoin. That’s more than US$22 billion worth at the time of writing, and about 3.1% of the entire 21 million supply of the asset, according to

Some huge institutional players have large exposure to Bitcoin through GBTC, including Cathie Wood’s Ark Invest and, more recently, US investment bank Morgan Stanley.

What’s the deal with the unlock?

From July 12, tapering off at the end of the month, Grayscale will periodically unlock about 40,000 BTC worth of fat cat investors’ GBTC shares. These shares were originally bought in early 2021 with a six-month lock-up stipulation.

The biggest single-day unlocking of the shares will occur on July 17, with 16,240 GBTC being made available to investors to sell on the open market.

It’s important to note that GBTC are shares, bought and sold at a premium or discount to the spot BTC price. They are not spot-market traded BTC.

And yet, some market participants have suggested the unlock event could further weigh down the price of Bitcoin this month.

Grayscale — who’s bearish?

Most notably, multinational investment banking giant J.P. Morgan.

“Selling of GBTC shares exiting the six-month lockup period has emerged as an additional headwind for bitcoin,” the US firm’s Nikolaos Panigirtzoglou warned investors on June 24, as reported by Coindesk. “The dynamic would lead to downward pressure on GBTC prices and on bitcoin markets more generally.”

Alex Mashinsky, CEO of crypto lending platform Celsius Network, has also been striking a short-term negative tone. As part of a series of recent tweets related to GBTC, he crystal-balled a July sell-off that he believes could bring BTC back down to the $29K level.

Grayscale — who’s bullish?

Among others, Jeff Dorman, chief investment officer at global digital asset manager Arca. In a June 28 newsletter debunking various bear market theses, he posited that heavy selling of GBTC on the open market would have no effect on the price of Bitcoin itself.

“As funds unwind this trade,” Dorman wrote, “it could actually put BUY pressure on bitcoin, not sell pressure, as those who sell GBTC will have to buy back bitcoin to cover the short leg of the trade.”

The latest Kraken Intelligence report, released on July 6, also takes a relatively positive stance: “The unlock means that market participants who attempted to arbitrage GBTC’s premium can hold onto their GBTC and keep their short on – meaning no net-selling of BTC.

“[Investors] could also sell their GBTC shares and cover their spot/futures short, which would result in net buying,” reads the report.

Who’s somewhere in between?

Some of the more nuanced commentary floating about Crypto Twitter over the past 24 hours has come from two Kiwis – Hong Kong-based Bitcoin analyst Willy Woo and Wellington crypto content creator Lark Davis.

In detailed threads, both have attempted to clarify and reason likely bullish and bearish effects of the GBTC unlocking, as well as dispel misinformation regarding the shares unlocks.

Summarising, Woo wrote: “The overall impact over the long term is neutral as it’s all arbitrage that balances out in time.”

Meanwhile, Lark Davis suggested: “in theory, a GBTC release should have no market impact on spot prices.”

But he warns there has been a price-dumping precedent set by past GBTC unlocks exacerbated by what he believes is heavy institutional market manipulation. Either way, as usual, he’s “just stacking sats and chilling”.