Market Turbulence Leads to ORDI’s Sharp Decline
On a tumultuous day for cryptocurrencies, the ORDI token saw its value diminish significantly. The token, which draws its inspiration from Casey Rodarmor’s innovative Ordinals Protocol, fell sharply by over 14% to record a new low for the month. The descent of ORDI coincided with a broader market downturn as Bitcoin dipped below the $40,000 mark, settling at $39,000.
The Ripple Effect of Bitcoin’s Performance
The ORDI token’s performance is closely tied to that of Bitcoin, the flagship cryptocurrency. The token’s value dipped below $55, marking the first occasion since December of the previous year that it had reached such lows. Analysts point to the outflows from the Grayscale spot Bitcoin ETF as a contributing factor to the broad market slump.
Grayscale’s ETF Outflows and Bitcoin’s Price
Speculation abounds that the significant outflows from Grayscale’s spot Bitcoin ETF, the most substantial and liquid BTC-focused fund recently approved for trading, have exerted downward pressure on Bitcoin’s price. This has, in turn, affected tokens like ORDI. Since receiving the green light from the SEC on January 10, Grayscale has reportedly sold off over $2.1 billion worth of Bitcoin and noted $2 billion in withdrawals from its funds. A considerable portion of these outflows can be traced back to the now-bankrupt crypto exchange FTX, which has been embroiled in legal disputes with Grayscale and its parent company, Digital Currency Group.
Wider Impact on the Crypto Market
Bitcoin’s value has seen a significant reduction, exceeding 20% within the same timeframe and is down by 10% this month alone. At the time of writing, Bitcoin’s trading price hovered around $39,300. The decline in Bitcoin’s value has had a cascading effect on other cryptocurrencies, including ORDI.
ETFs and Bitcoin Holdings
Despite the current market challenges, Grayscale’s ETF remains the largest, with a market cap exceeding $20 billion and a portfolio that includes 558,280 Bitcoins. Other issuers, such as BlackRock and Franklin Templeton, have not shied away from increasing their BTC holdings since the official launch of spot BTC ETFs on January 11. Research from Arkham Intelligence indicates that these entities, including BlackRock, Bitwise, Fidelity, and Franklin Templeton, now hold an aggregate of over 80,000 BTC, valued at nearly $5 billion.
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