Largest Bitcoin fund dives to record discount amid crypto swoon theedgemarkets.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from theedgemarkets.com Daily Mail and Mail on Sunday newspapers.
By Vildana Hajric and Katie Greifeld
It keeps getting worse for holders of the Grayscale Bitcoin Trust, which is now trading at a record discount to the value of the digital assets it holds.
The $35 billion fund (ticker GBTC) has lost roughly a fifth of its value since last Friday while Bitcoin tumbled from record highs. That’s helped to widen the difference between the share price and the underlying value of the Bitcoin holdings to roughly negative 19 per cent as of Thursday’s closing prices, according to data compiled by Bloomberg.
Investors are being squeezed in part because of the structure of the trust, which doesn’t allow redemptions like most traditional exchange-traded funds. Owners of the trust must find buyers in the secondary market if they want to sell, which can exacerbate the discount with the price of Bitcoin falling. GBTC has also faced increased competition from Canada, which has approved Bitcoin ETFs while U.S. regulators continue to consider applications.
Largest Bitcoin Fund Dives to Record Discount Amid Crypto Swoon forextv.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from forextv.com Daily Mail and Mail on Sunday newspapers.
How To Play Bitcoin And Bitcoin Stocks Right Now this post authored by Chris Johnson, Quantitative Specialist,
Money Morning
Investors welcomed the world s leading cryptocurrency exchange,
Coinbase Global Inc. (NASDAQ: COIN), to the market on a high note last Wednesday; its market debut valued the company at nearly $86 billion. From the opening bell, buyers started jumping into the shares, driving the price to well over $400 a share and giving the same company a value of over $100 billion.
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To put that into perspective,
Grayscale Effect Fades as GBTC Trades at Record -19% Low Discount
3 hours ago by John Kiguru · 3 min read
Photo: Depositphotos
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The discount has resulted in heavy losses for some investors, but Grayscale is keen on offering the discount to attract more even traders.
The Grayscale Bitcoin Trust (GBTC) has descended into levels never recorded in its history. Data shows that the product is trading at a 19% discount. GBTC’s premium has notably failed to rise despite the firm adding $283.3 million in BTC under management earlier in the week.
Beginning Thursday, GBTC’s premium has dropped by nearly 19% according to YCharts. This is the first time in its history it has sunk this low. Additionally, it is now in its third month of negative trading. The drop in the premium comes despite the firm continued accumulation of Assets Under Management (AUM). On Wednesday, the investment firm confirmed an additional $1 billion in its AUM.