After spending the whole month of March at a loss, the downward trend of Grayscale Bitcoin Trust's bounty has expanded. At the time of publication, the premium stands at -11.45%, near an all-time low of -14%.
GBTC at a reduced price. Source: Ycharts
In contrast, the Canadian Purpose Bitcoin ETF has seen a nearly one-month streak at record entry levels since April. , the discount GBTC, and the growth of the BTC ETF, investors tend to favor the latter.
Unlike other financial services products, GBTC shares do not can not be freely traded. They must go through a 6 month 'lock-in' period.give exposure to the BTC price, the stakeholder profit strategy is based on the premium, as analyst Ben Lilly points out:
If after 6 months the GBTC premium is high, it can be sold for a large percentage of the profits. Otherwise, the losses can be just as great.
Grayscale investors have started to voice their displeasure. Investment firm Marlton issued a press release on April 6 calling on Grayscale to take "immediate action to address GBTC's significant discount to net asset value" (NAV).
Marlton's data shows that GBTC's premium rebate represents about $ 3.1 billion in losses for shareholders. The firm called for a change in the stock trading mechanism that would allow them to buy or sell stocks at specific prices and times.
As Ben Lilly points out, the avèNew options for earning Bitcoin exposure in Canada appears to be hurting GBTC. Researcher Jan Wuestenfeld supports this thesis:
Strong demand for regulated Bitcoin-based financial products
The one above indicates clear demand from institutions looking to gain exposure to Bitcoin. At the same time, the Security and Exchange Commission (SEC) is under heavy pressure to approve a Bitcoin ETF. The Commission received more than 6 petitions to approve a Bitcoin ETF in the United States in less than 4 months.
The discount in the GBTC suggests investors favor products with better trading mechanisms. The performance of Canada's BTC ETF could create further more pressure for US regulator.
Senior commodities analyst for Bloomberg, Mike McGlone, sees a major inflection point in terms of adoption. New Bitcoin-based financial products could create a new "rising tide" from institutions and individual investors trying not to "miss the potential of Bitcoin". McGlone claimed :
BTC is trading at $ 57948 and showing moderate gains in the 24 hour chart at 3.5%. On the 7 day chart, BTC is still moving sideways.
BTC with moderate gains in the 24 hour chart. Source: BTCUSD Tradingview