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chriswen
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May 04, 2015, 04:33:21 PM |
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How can anyone sell shares on that market. Where do the shares come from? Can anyone explain this please. Thanks!
They are from accredited investors who bought into the the Bitcoin Investment Trust. The shares were frozen for 12 months as a condition for creating them as a tradeable entity on the OTC market. I'll guess a fair few bought in higher hence the lack of rush to sell. Interesting thing is that people seem to be able to sell the shares even though they're suspected to have held their shares for less than 12 months, actually... How is this possible and are those claims actually valid? How do we know those entities have bought their shares at a later date?! You only get shares to sell if they were held for more than 12 months. Otherwise you just have BIT. |
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"There should not be any signed int. If you've found a signed int
somewhere, please tell me (within the next 25 years please) and I'll
change it to unsigned int." -- Satoshi
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ensurance982
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May 04, 2015, 04:45:55 PM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Well, we broke down two hours ago and now we're back up quite a bit. A large ask-wall on Bitstamp, and quite some action going on. I wouldn't call this "no effect" to be honest. I believe people tried to sell the start of the ETF as bad news, and it didn't work out. So it's good news. Actually for real this time, though  |
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ensurance982
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May 04, 2015, 04:47:42 PM |
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How can anyone sell shares on that market. Where do the shares come from? Can anyone explain this please. Thanks!
They are from accredited investors who bought into the the Bitcoin Investment Trust. The shares were frozen for 12 months as a condition for creating them as a tradeable entity on the OTC market. I'll guess a fair few bought in higher hence the lack of rush to sell. Interesting thing is that people seem to be able to sell the shares even though they're suspected to have held their shares for less than 12 months, actually... How is this possible and are those claims actually valid? How do we know those entities have bought their shares at a later date?! You only get shares to sell if they were held for more than 12 months. Otherwise you just have BIT. Yeah, I know - But some people wrote about some asks from people or entities that are supposed to have only held their shares for less than 12 months. That's why I was wondering how they can be able to sell their holdings. And how do we know how long someone was holding their shares/stake? |
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jehst
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May 04, 2015, 04:48:51 PM |
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If we assume that BIT investors are rational, they should sell for 380 / BTC and then immediately reinvest in BIT at NAV to instantly and massively increase their number of shares. It doesn't matter what price you bought at. You can still increase your number of shares. (e.g. Sell 10 shares for 350 / BTC . Reinvest at NAV and buy 14 shares)
BIT investors won't sell if they believe the premium will increase even more.
But the more shares that are sold, the more supply is available for trading, and the lower the premium should go. Also, a launch of COIN would instantly destroy the big premium as COIN would allow people to buy at normal prices.
So the premium is temporary either way. These investors will see that opportunity to sell 5000 BTC for $350/BTC disappear one way or another. Whatever.
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Year 2021
Bitcoin Supply: ~90% mined
Supply Inflation: <1.8%
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BitAddict
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May 04, 2015, 04:53:35 PM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Some people could decide to sell their GBTC shares at $35 ($350) to rebuy real bitcoins at market price, now around $240. That's arbitrage and is very likely. |
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gotmilk_
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May 04, 2015, 04:55:55 PM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Some people could decide to sell their GBTC shares at $35 ($350) to rebuy real bitcoins at market price, now around $240. That's arbitrage and is very likely. Barry and his friends will make few mil$ in a week or two  |
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ensurance982
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May 04, 2015, 04:59:43 PM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Some people could decide to sell their GBTC shares at $35 ($350) to rebuy real bitcoins at market price, now around $240. That's arbitrage and is very likely. Barry and his friends will make few mil$ in a week or two Well, given the fact that the investors in the fund most likely all bought in at a higher price than the current BTC spot price, it's only fair for them to make at least some money by doing some arbitraging now the fund finally started trading! |
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elux
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May 04, 2015, 05:01:20 PM |
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gotmilk_
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May 04, 2015, 05:03:30 PM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Some people could decide to sell their GBTC shares at $35 ($350) to rebuy real bitcoins at market price, now around $240. That's arbitrage and is very likely. Barry and his friends will make few mil$ in a week or two Well, given the fact that the investors in the fund most likely all bought in at a higher price than the current BTC spot price, it's only fair for them to make at least some money by doing some arbitraging now the fund finally started trading! Also more than 35k btc was bought below current price  Btw. will be interesting to see how many shares will BIT hold on end of the May (sort of indicator how many "arbitrage trades" will be, of course there could be just new shares from new investors). |
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JorgeStolfi
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May 04, 2015, 05:26:14 PM |
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Well, given the fact that the investors in the fund most likely all bought in at a higher price than the current BTC spot price, it's only fair for them to make at least some money by doing some arbitraging now the fund finally started trading!
The opening post and this plot show how much was bought at what price. (Those are net investments. There have been some redemptions, but not enough to significantly change the conclusions, IIRC.) |
Academic interest in bitcoin only. Not owner, not trader, very skeptical of its longterm success.
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ensurance982
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May 04, 2015, 05:39:11 PM |
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Well, given the fact that the investors in the fund most likely all bought in at a higher price than the current BTC spot price, it's only fair for them to make at least some money by doing some arbitraging now the fund finally started trading!
The opening post and this plot show how much was bought at what price. (Those are net investments. There have been some redemptions, but not enough to significantly change the conclusions, IIRC.) Yeah, so I guess it's safe to say that effectively everyone bought their shares at a higher price than the current BTC spot price. If they aren't in for the advantages of having your coins in form of an ETF, they may very well be quite tempted to use this as an arbitrage opportunity! It just remains to be seen how quick they can turn their money around to another exchange for this. |
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minerpumpkin
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May 04, 2015, 05:46:37 PM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Well they're buying existing Bitcoin. The influence on the price is just about the same influence as any trading on a regular exchange has on the price, nothing more, nothing less. Of course the influence isn't as direct and immediate, but overall it's a closed system, actually. |
I should have gotten into Bitcoin back in 1992...
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windpath
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May 04, 2015, 05:48:25 PM |
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My favorite ask of the day, $2.5MM per BTC  |
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BTCMILLIONAIRE
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May 04, 2015, 08:29:20 PM |
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My favorite ask of the day, $2.5MM per BTC lol SEWN!!! |
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Biodom
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May 04, 2015, 08:34:42 PM
Last edit: May 04, 2015, 08:49:35 PM by Biodom |
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My favorite ask of the day, $2.5MM per BTC >snip url< lol SEWN!!! Everything is just a game. How a stock that suppose to simply indicate 1/10 of bitcoin is trading at a 42% premium to the underlying? |
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HI-TEC99
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May 04, 2015, 08:35:24 PM
Last edit: December 26, 2015, 12:27:48 AM by HI-TEC99 |
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My favorite ask of the day, $2.5MM per BTC I remember someone put an ask of one Doge for one Bitcoin on when Doge hit Cryptsy, and someone paid it! They probably bought it off themselves as a stunt to try and pump the price up. That ridiculously priced ask sounds similar, but nobody's bought it yet. |
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elux
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May 04, 2015, 09:33:17 PM |
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jehst
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May 04, 2015, 09:42:33 PM |
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Very exciting day. It was fun waiting with you guys. I'm unsubscribing from this thread now.
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Year 2021
Bitcoin Supply: ~90% mined
Supply Inflation: <1.8%
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JorgeStolfi
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May 05, 2015, 12:20:17 AM |
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Seems like this will have little effect on exchange prices since no new bitcoins are being bought.
Well they're buying existing Bitcoin. The influence on the price is just about the same influence as any trading on a regular exchange has on the price, nothing more, nothing less. Of course the influence isn't as direct and immediate, but overall it's a closed system, actually. Any large discrepancy between the GBTC price and the market price of "raw" BTC will probably take months to a year to be equalized by arbitrage, since shares will have to be redeemed, or created and then held for a year. Isn't this so? |
Academic interest in bitcoin only. Not owner, not trader, very skeptical of its longterm success.
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ElectricMucus
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Marketing manager - GO MP
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May 05, 2015, 08:23:45 AM |
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280% bid/ask spread. Oh crap, what a turd! PS: A whopping 76 BTC worth of volume!!!111oneelven |
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