OTC Desks Are Rapidly Running Out Of Bitcoin: Caitlin Long
The rapid growth of Bitcoin spot ETFs has dramatically reduced the supply of Bitcoin available through over-the-counter (OTC) desks.
The trend is both visible with blockchain data and was acknowledged by Custodia Bank CEO Caitlin Long on Thursday.
“I spent time in NYC over the past couple of days and it’s clear why the [the] Bitcoin price spiked this week: there was almost no BTC available for sale on the big OTC desks,” Long wrote to X.
Bitcoin is now trading for over $62,000 per coin following a massive February rally—its largest monthly green candle close ever recorded
Many of those gains were driven by seismic inflows to newly launched Bitcoin spot ETFs over the past 50 days, which have already received over $7.4 billion of net inflows during that time.
Bitcoin ETF market makers purchase new BTC “over the counter” or “OTC” – meaning they conduct private purchases with large BTC holders rather than gathering coins directly on the open market.
While this prevents short-term slippage, suppliers must eventually return to public exchanges to source new Bitcoin when demand is overwhelming, ultimately pushing up Bitcoin’s price.
“Only ~40 BTC available for sale at any price at one point on Wednesday, I was told by a credible source,” added Long.
According to Glassnode data, Bitcoin available on OTC desks has declined rapidly since December and is now trending close to zero.
WARNING: The #Bitcoin price is about to go parabolic! There's no OTC Bitcoin available while BlackRock customers are buying half a billion dollars' worth daily… pic.twitter.com/DVFc9KhVKi
— sunnydecree (@sunnydecree) March 1, 2024
That said, on-chain data for OTC Bitcoin isn’t the most reliable, according to some analysts.
“The idea that OTC desks are literally out
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