Grayscale Buys 800% More Bitcoin Compared to Q1 2019

[Harlot]

Grayscale is buying Bitcoin at the current market value and has no regards with having a margin of safety in their orders? Can this mean something? Like are we headed into a big pump that is why they are confident at buying at these levels? Or are they buying all of these in a participation of a short so they can profit more all the way down? Either way these news about them buying more than the currently new mined BTC doesn't give us a straight answer on what the future price will be for Bitcoin since we don't even know how Grayscale will play out their current Bitcoin holdings.

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[FanEagle]

At what price you buy bitcoin doesn't matter to you when you are doing so well with the bitcoin returns. They do not care about the current price, this is an investment company and all they care about is increasing their revenue by having multiple investments, grayscale is not buying bitcoin alone, they are buying many things, they are trying to profit as much as they can so bitcoin will keep on being on their list and they are going to buy more and more of it to profit more in the future. Look at all the hedge funds, as soon as they find something they like they end up buying a bunch of it.

Long term investment is much much more important for these type of companies, they want to make a profit in 10 years, not tomorrow. So, there is a big difference between them and regular traders/investors like us.

[7788bitcoin]

Grayscale is buying Bitcoin at the current market value and has no regards with having a margin of safety in their orders? Can this mean something? Like are we headed into a big pump that is why they are confident at buying at these levels? Or are they buying all of these in a participation of a short so they can profit more all the way down? Either way these news about them buying more than the currently new mined BTC doesn't give us a straight answer on what the future price will be for Bitcoin since we don't even know how Grayscale will play out their current Bitcoin holdings.

There is no guarantee that the price of bitcoin would rally because some financial institute is investing in bitcoin thinking that the price would rally. I bet there are other financial investors investing in bitcoin whenever the price goes down thinking that they could make a huge profit when the price rallies.
These investments are not meant to hold the coins for a decade and they only want to book the profit when the price rallies.

[guigui371]

Grayscale is buying Bitcoin at the current market value and has no regards with having a margin of safety in their orders? Can this mean something? Like are we headed into a big pump that is why they are confident at buying at these levels? Or are they buying all of these in a participation of a short so they can profit more all the way down? Either way these news about them buying more than the currently new mined BTC doesn't give us a straight answer on what the future price will be for Bitcoin since we don't even know how Grayscale will play out their current Bitcoin holdings.

There is no guarantee that the price of bitcoin would rally because some financial institute is investing in bitcoin thinking that the price would rally. I bet there are other financial investors investing in bitcoin whenever the price goes down thinking that they could make a huge profit when the price rallies.
These investments are not meant to hold the coins for a decade and they only want to book the profit when the price rallies.

All they need to achieve is a cool +10% and they have achieved their yearly target.
Don't you think that all the btc purchases done by greyscale now ($9-$9.6k) won't be counterbalanced by the price of BTC being $10-10.5k in the next 3 to  6 months?
Allowing them to sell their assets and make their yearly target.

They are an investment company, they invest to make money, not to change the world.

[Upgrade00]

Update; Greyscale are not slowing down as they have accumulated 9,503 more bitcoins since the most recent report, this is also more than the amount of bitcoins mined within that period. At an average rate of 10 minutes per block; 6,300BTC gets mined each week.



This trades happen OTC, so there's no significant impact on the market price, but as Greyscale continues to add to their Bitcoin AUM, this could attract other institutional investments?

[gentlemand]

This trades happen OTC, so there's no significant impact on the market price, but as Greyscale continues to add to their Bitcoin AUM, this could attract other institutional investments?

It's impossible to quantify but there will be an effect. OTC means open market trades that otherwise would've happened don't. And the volume of Grayscale's buying means other would-be OTC buyers have to go to the open market as they've been driven to it.

[Upgrade00]

<snip>

To get some clarity, are you suggesting that OTC trades limits the trades that otherwise would have happened on the open market, and the volume being bought by Grayscale, would take up most of the OTC stash driving other than that who would have purchased over the counter to the open market?

[gentlemand]

To get some clarity, are you suggesting that OTC trades limits the trades that otherwise would have happened on the open market, and the volume being bought by Grayscale, would take up most of the OTC stash driving other than that who would have purchased over the counter to the open market?

Yes. If the OTC market didn't exist at all all of these people would be on exchanges.

We have no idea how big the OTC market is so there's no way of knowing how much availability Grayscale are hogging, but it must be a significant uptick compared to the past. I don't remember them buying this furiously in the past.

Sometimes there just isn't enough OTC to go round. Available supply is finite. Most of it has to be prised out of someone who already owns it. Sometimes you'll have to go to an exchange no matter what if you're hungry to buy.

[Lucius]

Update; Greyscale are not slowing down as they have accumulated 9,503 more bitcoins since the most recent report, this is also more than the amount of bitcoins mined within that period. At an average rate of 10 minutes per block; 6,300BTC gets mined each week.

Some would say, an incredible appetite for Bitcoin by Grayscale, and also raises the question of how long they will continue at this rate of investment? What is certainly in their favor is the possibility of OTC purchase, because as we see it almost has no effect on the price. What many are interested in is how big the OTC market actually is, and this is certainly not a question that has any exact answer.

According to some research from 2018 by Bloomberg, daily crypto OTC market was "anywhere between $250 million and $30 billion per day", and volume on exchanges was $15 billion. If this is somewhat true, then the OTC bag is quite deep and Grayscale and similar investors have a great opportunity to buy large quantities of BTC without directly affecting the price. Who knows, maybe they've been doing it for years, as some have speculated.

[gentlemand]

One thing I didn't bother to check is who is buying all their GBTC shares.

This is slightly old but gives an idea - https://medium.com/grayscale-investments/strongest-quarter-ever-81035e384ee6

84% of inflows has been primarily from hedge funds. On one hand that's cool that institutional interest is rising, on the other many will be clueless and twitchy bitches who'll run for the door given half the chance. That delay in selling might stop that but that level of their involvement could be a double edged sword.

[justdimin]

This is OTC we are talking about, we could NEVER learn how much is going on, so we can't even make a guess or a prediction about what would happen if it was online and on places like coinbase or something that we could see. OTC will be done because lets face it these companies are dealing with too much money and if they didn't used OTC for it they would have disturbed the market a ton.

Think about grayscale actually buying from coinbase which means they are buying from you and me, they would increase the price a ton when buying and would have to buy for more money, this way they could pay the market price and a bit more maybe to buy tens of millions of dollars without changing the price at all. It is all a sensitive subject that has to be hidden from the market until after it is done.

[exstasie]

I took a closer look at the GBTC chart vs. BTCUSD and noticed the GBTC premium has been falling quite a bit recently. It's dropped in half since February alongside these big inflows.

I think there is increasing pressure to arbitrage the GBTC price. Even given the 1-year lockup period, a 30% premium (that's what it was at the Febuary peak) is just ridiculous not to arbitrage in a market with increasing regulated options at lower carry costs.

As one example, institutions could short GBTC while it's trading at a huge premium while buying shares at a discount (the NAV price) during private placements.

If this explains the increased volume, then we can probably expect the volume to die down (and maybe Grayscale's overall holdings to decrease as well) once the premium is no longer worth arbitraging.

https://cointelegraph.com/news/what-does-grayscales-gbtc-falling-premium-tell-us-about-bitcoin-price

I've been struggling to find an explanation since GBTC is so unattractive as an investment with its ridiculous premiums and 2% management fee. This is the best I can come up with.

[bbc.reporter]

It appears that Barry Silbert's wallets are full. He will begin step 2 next week. The mainstream media hype and pump campaign hehehe.

Where is Tom Lee hehe.



Are you ready? @Grayscale's national ad campaign kicks off next week with a TV ad on CNBC, MSNBC, FOX, and FOX Business. We're going to brrring crypto to the masses

Source https://twitter.com/barrysilbert/status/1291710737291841543

[bitbunnny]

Don't take this as a proof that price will riae strongly. The fact that some financial institution is buying Bitcoin doesn't have to mean anything. Besides they can also nake wrong estimation. What I want to say is that the news like that shouldn't be the ground for your decision whether to buy or sell.

[exstasie]

Are you ready? @Grayscale's national ad campaign kicks off next week with a TV ad on CNBC, MSNBC, FOX, and FOX Business. We're going to brrring crypto to the masses

Source https://twitter.com/barrysilbert/status/1291710737291841543

Well I sure hope they don't buy into GBTC with its atrocious 2% management fee.

Not to mention a dangerous premium that will decline as more regulated options come on board.

I'm looking forward to the launch of Wilshire Phoenix's BTC fund. It'll have a 0.9% management fee and unlike GBTC, it will actually offer a redemption program to keep prices pegged to spot. https://cointelegraph.com/news/exclusive-wilshire-differentiates-its-fund-from-grayscale-says-investors-deserve-more

This actually smells a bit like Barry's exit pump.

[bitgolden]

Honestly I am fine with people buying into grayscale and their fee's, if that means that people would be more interested with bitcoin so be it, let them pay more fee, as long as they get into bitcoin I do not care how they do. This company is the only company we are aware that publicly states how much bitcoin they are investing and how much they like bitcoin, maybe the giants like JP Morgan does too but we do not see them publicly saying how many bitcoins they have do we?

Hence, I think this grayscale is the richest bitcoin lover in the world for now until some other one comes up and says how many bitcoins they own. This also shows people that when a big company gets into bitcoin they do not just buy a bit, they buy so much that they could change the market with one move if they want to.

[Febo]

It appears that Barry Silbert's wallets are full. He will begin step 2 next week. The mainstream media hype and pump campaign hehehe.

Where is Tom Lee hehe.



Are you ready? @Grayscale's national ad campaign kicks off next week with a TV ad on CNBC, MSNBC, FOX, and FOX Business. We're going to brrring crypto to the masses

Source https://twitter.com/barrysilbert/status/1291710737291841543

Yup he bought in March and April when Bitcoin was cheap, now will unload. Smart to first build hype on TV and other media.

[bbc.reporter]

@Febo. However, has Barry Silbert unloaded before? It might be a mistake. He should unload his altcoins first, I reckon. He is one of the biggest investors of the 51% attackers' favorite Ethereum Classic hehehhe.

[slaman29]

It appears that Barry Silbert's wallets are full. He will begin step 2 next week. The mainstream media hype and pump campaign hehehe.

Where is Tom Lee hehe.

Are you ready? @Grayscale's national ad campaign kicks off next week with a TV ad on CNBC, MSNBC, FOX, and FOX Business. We're going to brrring crypto to the masses

Source https://twitter.com/barrysilbert/status/1291710737291841543

I remember grayscale also had that huge marketing campaign about digital gold right? Where people were running around in wheelbarrows buying gold but I thought it was silly because most people I know can't even afford to buy 1 whole kilo of gold and with the price now ATH, even more impossible.

And yes, where is Tom Lee??

[bbc.reporter]

Presenting Barry Silbert's campaign commercial for bitcoin.

https://twitter.com/sonnenshein/status/1292792512780947457?s=21

As a person who knows the history, I was shaking my head and I felt a little embarassed after I saw names of altcoins BCH, Zcash , Ripple, Stellar, Ethereum, Ethereum Classic in there. The commercial has nice music, however hehehe.