A massive $1.26 billion block trade in BlackRock’s iShares Bitcoin Trust (IBIT) last week was likely a whale making a quick exit on a directional trade, according to Greg Cipolaro, head of research at NYDIG.
The trade involved 29.2 million shares sold on a dark pool - a private platform for large institutional trades - sparking speculation about the seller’s identity and motives.
Cipolaro noted in a research note Friday that several indicators point to a large directional holder exiting a concentrated position, rather than a basis-trade unwind. The seller accepted a price $1.01 below the market, sacrificing $29.5 million for immediate execution.
Bitcoin (BTC) slid 2.8% on the day of the trade, but Bloomberg ETF analyst Eric Balchunas said the market absorbed the block sale well.
“The key unanswered question is whether the seller was responding to idiosyncratic constraints or expressing a broader investment view,” Cipolaro said.
US-listed Bitcoin ETFs have now recorded 11 straight trading days of net outflows, with $333.6 million leaving on the same day as the massive IBIT trade, according to Farside Investors data. Over $2.9 billion has flowed out since May 14.
Cipolaro said the urgency in the sale suggests a discretionary liquidation, possibly due to investor redemptions or balance-sheet constraints, rather than a portfolio rebalance. However, public data cannot definitively determine the motive.
“The weakening technical backdrop, ongoing ETF outflows, and willingness to pay a substantial execution premium for immediacy are more consistent with discretionary liquidation,” he said.