4. They are too incompetent/scared to buy and secure the same asset for less than half price, but still want to hodl.
They can buy new BIT shares from Second Market / Grayscale. |
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He wants 310 USD / BTC, so he just buy on an exchange and sell on Local Bitcoins.
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Even as a permabull I'm kinda doubting the Stockholm launch. I don't know why, but I am. It's great for the validity of bitcoin, and it helps move bitcoin out of the fringe anarchic nerd circle, but for some reason I'm not expecting much volume from KNCs Bitcoin Tracker.
Doesn't the whole concept of an ETN depend the issuers credit rating and credibility? If I was looking to invest I wouldn't be hugely impressed by KNCminer as a company. There's no shortage of beefs from their customers. The notes are issued by XBT Provider AB, a new company. It shouldn't be hard to prove that they are not running with fractional reserve. |
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Anybody know how that process works? If somebody buys 100 shares will a xbt bot buy 100 shares off a exchange in real time? Or is it a deal where if more and more shares get bought then will buy in like 1000 coin baskets off a exchange whenever they want?
If Bitcoin Tracker One trade above the real bitcoin price, XBT Provider AB (Swedish company) will buy bitcoins and sell new notes on the exchange. |
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 Don't cry, fellow bulls. Just 8 days to Nasdaq Sweden start trading bitcoin-paper (backed by real BTC). This time, with unlimited volume on both bids and asks. (The GBTC has less than 150.000 bitcoins in matured shares.) I don't think its backed by real BTC. When you buy oil shares, you don't back up your shares with buying more actual oil. Yes it is. From Coindesk: "XTB Provider AB will hedge all sales of the bitcoin traded note by buying an equal value in the bitcoin market." I believe people underestimate the potential of Bitcoin Tracker One since it's trading on Nasdaq Stockholm, but the bears should be scared... |
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Anyone else watching the GBTC trading ?
Looks like the volume so far today is 435 shares, over half of yesterday's volume already and it's only just opened for the day.
As far as I know some can be posted overnight and then actioned first thing in the morning so this could be it.
Can anyone else confirm this ?
That is yesterdays number. I believe the market opens in 1.5 hour. |
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With the high premium on the OTC Market, what is interesting is to see how many new shares in the BIT that are being sold in the coming months.
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I have a question about GBTC: If you buy a share, can you convert it to real bitcoin? (Maybe it sounds stupid, but I think it's important and not obvious because of this trend with "advanced trading assets" and other shit talk) EDIT: And I support "The List" 100%! That's what I believe too. That if you actually buy a share you actually buy the equivalent BTC amount. I don't have an account there, but I believe there should be an option to get your BTCs out if you'd like... 1 share doesn't continually represent .1 BTC, as there are fees. You can redeem in baskets of 100 shares (though I saw in one place that the "Authorized Participant" is not accepted redemption requests right now). Do we know what these fee's are? 2% a year. Starting at September 24, 2013. |
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Thanks for the explanation, if this is the case then the SEC policy doesn't seem to make a lot of sense.
After accredited investors purchase shares and hold for 1-year, they are now selling those shares to non-accredited investors on the OTC market. Which means that non-accredited investors are buying the fund in the end. The only difference for GBTC is that only accredited investors can initiate the creation of shares, but anyone can trade them.
If I'm understanding this correctly is seems absurd.
The "Accredited Investor" thing was relevant until last October or so, while BIT was under different rules. Accredited Investors (i.e. individuals with "money that they could afford to lose") could buy shares directly from SecondMarket by paying in USD, at about the current price o 0.1 BTC per share. Now, only "Authorized Pariticpants" can get shares from Grayscale, by giving BTC to it. SecondMarket is an Authorized Participant and so they may still be able to act as middlemen and sell new shares to individuals for USD, as they did before (does the 1 year holding apply to them too?). If so, perhaps they still require the buyer to be an Accredited Investor. Those shares would still have to be held for one year before resale. Perhaps SecondMarket now can charge a premium for those shares? Qualified accredited investors** can choose to invest directly in the BIT at the applicable NAV per share. The BIT’s shares are subject to significant resale and transfer restrictions. http://grayscale.co/investors/ |
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plus anyone could explain the hell is "Each GBTC share represents ownership of approximately 0.1 bitcoin" supposed to mean? is one share 1/10th of an <imaginary> bitcoin or not?
0.1 BTC - fees |
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As for dinners, my dinner friends won't let me talk about bitcoin for more than 30 seconds each night. And they are as surprised as you are that I be wasting so much time with this [ expletive deleted by self-censorship subroutine ].
I see. Your dinner friends understand Bitcoin. You should try to learn from them. |
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They could sell on OTC and buy again directly from Secondmarket as accredited investors. Only thing they would lose is the ability to sell on OTC for another year. Even that is not so bad, since presumably Secondmarket will unsuspend redemptions at some point.
My understanding was that new shares couldn't be sold for a year, however once a share is initially sold (after 12 months), it can then be traded freely. New shares can be sold right away, but only to accredited investors. One year old shares can be bought by everyone. |
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Yes, it only applies to thin clients. A full client calculates the UTXO set and Merkle hash from the complete history, compares it to a new block's UTXO hash and rejects the block if they don't match.
how is this practical? don't UTXO sets differ slightly just like the mempools unconfirmed tx's? The UTXO set merkle hash is created out of confirmed transactions. |
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Also the supply of BIT shares is rather small and fixed because of the 12 months "maturation" period.
New BIT shares can be created tomorrow, sold to accredited investors, but they can't be sold on the OTC Market for the next 12 months. |
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Like someone has insider info about institutional demand of GBTC and bought up all the cheap coins for themselves.
Isn't it a walled garden though? Virtually nothing can get in and out. It'll be fun to look at but won't have much relevance for any other market. Accredited investors can buy new shares in the fund. New shares must be backed by real coins. |
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