GBTC Bitcoin Investment Trust Observer

[Vlad2Vlad]

Now that Shanghai is making gold and silver markets in yuan, backed by actual physical transactions, I'd like to see the SFE create COIN-like vehicles for BTC exposure (only with less absurdly byzantine regs and obviously self-serving delays).

When it takes a Spider Woman years to simply reuse GLD's template, the Deep Capture is beyond Jump You Fuckers territory and well into the realm of Up Against The Wall, Assholes.

Great post, man!  I totally agree.  And I think china is gonna launch a gold backed crypto.  Not sure when but it makes a lot of sense.

[Alley]

At some point you would think investors would just start buying physical bitcoins rather then pay over $700 per coin now with gbtc.  I don't get it...

[iCEBREAKER]

At some point you would think investors would just start buying physical bitcoins rather then pay over $700 per coin now with gbtc.  I don't get it...

What you "don't get" is that due to certain Wall St Ponzi scheme benefiting tax arrangements/incentives, many working slobs are only allowed to invest their IRA $$$ in the stock market.

So GBTC is being bought with blue $$$, not the green $$$ used to buy BTC everywhere else.  Totally different market; hard to arb.

This trend will greatly intensify when COIN is ready, because it will be vastly more eligible for IRA (and institutional) $$$ than obscure pink sheet GBTC.

[megadeth]

Wouldn't directly holding Bitcoin in an IRA offer better value?
https://www.broadfinancial.com/self-directed/bitcoin-ira/

Is the legality of the above questionable?

[iCEBREAKER]

Wouldn't directly holding Bitcoin in an IRA offer better value?
https://www.broadfinancial.com/self-directed/bitcoin-ira/

Is the legality of the above questionable?

No way to tell.  They make it up as they go along.

If you concede to the authoritarians, your reward is a Kafkaesque nightmare of conflicting definitions and overlapping regulations/jurisdictions.

Better to put them on notice that if they make it personal, you will respond in kind.

[Fakhoury]

Wouldn't directly holding Bitcoin in an IRA offer better value?
https://www.broadfinancial.com/self-directed/bitcoin-ira/

Is the legality of the above questionable?

No way to tell.  They make it up as they go along.

If you concede to the authoritarians, your reward is a Kafkaesque nightmare of conflicting definitions and overlapping regulations/jurisdictions.

Better to put them on notice that if they make it personal, you will respond in kind.

When do you expect to have COIN ETF bro ?

[iCEBREAKER]

Wouldn't directly holding Bitcoin in an IRA offer better value?
https://www.broadfinancial.com/self-directed/bitcoin-ira/

Is the legality of the above questionable?

No way to tell.  They make it up as they go along.

If you concede to the authoritarians, your reward is a Kafkaesque nightmare of conflicting definitions and overlapping regulations/jurisdictions.

Better to put them on notice that if they make it personal, you will respond in kind.

When do you expect to have COIN ETF bro ?

No way to tell.  That conspicuous lack of objective decision criteria is a leading indicator the rule of law is dead and we must once again address the present intolerable tyranny of men.

[Vlad2Vlad]

Wouldn't directly holding Bitcoin in an IRA offer better value?
https://www.broadfinancial.com/self-directed/bitcoin-ira/

Is the legality of the above questionable?

Sure, until the confiscations start. 

[Vlad2Vlad]

At some point you would think investors would just start buying physical bitcoins rather then pay over $700 per coin now with gbtc.  I don't get it...

What you "don't get" is that due to certain Wall St Ponzi scheme benefiting tax arrangements/incentives, many working slobs are only allowed to invest their IRA $$$ in the stock market.

So GBTC is being bought with blue $$$, not the green $$$ used to buy BTC everywhere else.  Totally different market; hard to arb.

This trend will greatly intensify when COIN is ready, because it will be vastly more eligible for IRA (and institutional) $$$ than obscure pink sheet GBTC.

Dude you sound just like me and that other crazy guy, TPTB_Need_War. 

Then there were 3.  lol

[GGALINff]

Still no good way to arb this then??

I wish.  It took me most of a year to push through to real liquidity (although technically that is unproven until I do sell at least a portion, hmm).  I do believe it would go faster the second time but to arbitrage it would require something less than a month for me to be comfortable and more like a few days to really crank it up.  I might take a second smaller lot in just to try; they did indicate that I wouldn't have to take a full $25K in since I'm already established.  If I do then I will report back.

I am reluctant to take out any of what I've got in already for fear of missing a jump up while goofing around trying to get it back in.  I am as long-minded as one can get.  That said, I've got as much of my total wealth in already that I'm comfortable with.  $70.90/$42.60 is a crazy huge spread and very tempting.

Isnt arbing next to impossible because you have to hold atleast 1 year?

Apparently that only applied to the original investment; new funds going in now are converted to GBTC without any holding period at all.

All new investments (including follow-on by existing investors)  are subject to 12 month holding period

[Vlad2Vlad]

All new investments (including follow-on by existing investors)  are subject to 12 month holding period

This is just one reason why COIN is gonna catch Bitcoin [and cryptoworld] on fire. 

[David Rabahy]

All new investments (including follow-on by existing investors)  are subject to 12 month holding period

That doesn't match what I was told.  I have sent an email to Grayscale asking for clarification and will post the response here when I get it.

[NUFCrichard]

Now that Shanghai is making gold and silver markets in yuan, backed by actual physical transactions, I'd like to see the SFE create COIN-like vehicles for BTC exposure (only with less absurdly byzantine regs and obviously self-serving delays).

When it takes a Spider Woman years to simply reuse GLD's template, the Deep Capture is beyond Jump You Fuckers territory and well into the realm of Up Against The Wall, Assholes.

Great post, man!  I totally agree.  And I think china is gonna launch a gold backed crypto.  Not sure when but it makes a lot of sense.

Why would a gold backed cryptocurrency be good? Crypto can back itself, gold is already well established.
If I send you some of the gbc (gold backed crypto), will I also have to send you the gold?  Or will it be stored in a central place? if so by whom?

[David Rabahy]

All new investments (including follow-on by existing investors)  are subject to 12 month holding period

That doesn't match what I was told.  I have sent an email to Grayscale asking for clarification and will post the response here when I get it.

My bad; per Rule 144 http://www.investopedia.com/terms/r/rule144.asp there is a 12 month holding period effectively making arbitrage way too slow.

[iCEBREAKER]

At some point you would think investors would just start buying physical bitcoins rather then pay over $700 per coin now with gbtc.  I don't get it...

What you "don't get" is that due to certain Wall St Ponzi scheme benefiting tax arrangements/incentives, many working slobs are only allowed to invest their IRA $$$ in the stock market.

So GBTC is being bought with blue $$$, not the green $$$ used to buy BTC everywhere else.  Totally different market; hard to arb.

This trend will greatly intensify when COIN is ready, because it will be vastly more eligible for IRA (and institutional) $$$ than obscure pink sheet GBTC.

Dude you sound just like me and that other crazy guy, TPTB_Need_War. 

Then there were 3.  lol

Ha!   

The Great Schism has been distracting us from what's really important to Bitcoin - libertarian invective, strident to the point of flaming.

Can't let Crazy Uncle Shelby and Bitcoin Judas monopolize that space.  Small-blocker cyberpunks do it better!   

[bobabouey2]

All new investments (including follow-on by existing investors)  are subject to 12 month holding period

That doesn't match what I was told.  I have sent an email to Grayscale asking for clarification and will post the response here when I get it.

My bad; per Rule 144 http://www.investopedia.com/terms/r/rule144.asp there is a 12 month holding period effectively making arbitrage way too slow.

It will be an interesting dynamic for GBTC if the Winklevoss ETF (COIN) suddenly gets traction.

As COIN is going through a full listing process instead of relying on the 144 loophole, it will not have the same arbitrage issues as with GBTC.  So it should have very little - or at least, much less - spread between market price and NAV.

And COIN will be purchasable in the same 401k / Roth / IRA accounts as GBTC.  And those accounts grow tax free, so you won't take a tax hit if you sell GBTC to buy COIN.

So once COIN is trading, the GBTC premium should evaporate.

However, if COIN starts to show traction, bitcoin may have a run, and GBTC's premium might be maintained for some period of time by people who want to capture that run without buying bitcoin directly, or if 401k type accounts.

[GGALINff]

you can still pseudo arb this if you think the premium is too large

1)  sell the GBTC  (provided you own it)
2)  use proceeds to buy 'physical' btc

if you are correct and the spread decreases - you can use the proceeds in #1 to buy GBTC and sell #2 to cover the cost

not perfect though - you lose out if the spread increases  + you don't get the magic premium that happens when you transfer from the BIT fund to GBTC...but you need to wait 12 months for that one

[bobabouey2]

you can still pseudo arb this if you think the premium is too large

1)  sell the GBTC  (provided you own it)
2)  use proceeds to buy 'physical' btc

if you are correct and the spread decreases - you can use the proceeds in #1 to buy GBTC and sell #2 to cover the cost

not perfect though - you lose out if the spread increases  + you don't get the magic premium that happens when you transfer from the BIT fund to GBTC...but you need to wait 12 months for that one

Of course, but a key rationale for owning GBTC is owning it in a 401k / IRA.  It is hard to buy bitcoin in those funds.  You could buy direct from bitcoin investment trust at NAV, but you have to be an accredited investor and then hold for at least a year.  And you'd have to have self administered fund, you couldn't do it through a company 401k.

There are other ways of getting direct bitcoin into a self-administered IRA, but it is fairly complicated.

[GGALINff]

you can still pseudo arb this if you think the premium is too large

1)  sell the GBTC  (provided you own it)
2)  use proceeds to buy 'physical' btc

if you are correct and the spread decreases - you can use the proceeds in #1 to buy GBTC and sell #2 to cover the cost

not perfect though - you lose out if the spread increases  + you don't get the magic premium that happens when you transfer from the BIT fund to GBTC...but you need to wait 12 months for that one

Of course, but a key rationale for owning GBTC is owning it in a 401k / IRA.  It is hard to buy bitcoin in those funds.  You could buy direct from bitcoin investment trust at NAV, but you have to be an accredited investor and then hold for at least a year.  And you'd have to have self administered fund, you couldn't do it through a company 401k.

There are other ways of getting direct bitcoin into a self-administered IRA, but it is fairly complicated.

I hear ya- trying to defer on the tax- but hey,  never forget... better to make money and pay tax than not make the money at all

[GGALINff]

good volume - spreads are pretty