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Investors who locked in borrowed coins will need to repurchase those to repay the loan, cryptocurrency pundits say.

The bitcoin market could get a boost this month from the expiration of investor restrictions on the sale of shares in the Grayscale Bitcoin Trust (GBTC), the world’s largest cryptocurrency fund.

Some digital-asset analysts and investors say it’s possible some of these investors might need to enter the market to buy bitcoin – to repay cryptocurrency loans they used to finance their original purchases of the GBTC shares.

“Lots of bearish chatter around GBTC unlocks whilst conveniently ignoring that in-kind subscriptions funded by debt will ultimately translate into spot buying,” crypto services provider Amber Group tweeted.
The view contrasts with a forecast published last month by analysts at JPMorgan, the largest U.S. bank, who argued the end of the lockup period would weigh on the GBTC shares and bitcoin.

“Selling of GBTC shares exiting the six-month lockup period during June and July has emerged as an additional headwind for bitcoin,” the JPMorgan strategists, led by Nikolaos Panigirtzoglou, wrote on June 24. The dynamic would lead to “downward pressure on GBTC prices and on bitcoin markets more generally.”

But with the pace of unlockings now poised to increase, crypto-native analysts are pushing back against the narrative. While the selling of GBTC shares could lead to a deeper discount and drive away fresh capital, its negative impact is likely to be mitigated by the repurchases of bitcoin in the spot market. (Grayscale is a unit of Digital Currency Group, of which CoinDesk is an independent subsidiary.)

“The biggest unlocks are happening over the next two months, which could lead to heavy selling of GBTC on the open market,” Jeff Dorman, chief investment officer at the cryptocurrency-focused asset manager Arca, wrote this week in a newsletter.

“As funds unwind this trade,” he 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.”

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