Everything you wanted to know about Grayscale BTC Trust but were afraid to ask!

[fillippone]

Grayscale today announced the formal appointment of former Alerian CEO David Lavalle, Senior Managing Director, Global head of ETFs reporting directly to Michael Sonnenschein, CEO of Grayscale, to lead its efforts to transform a bitcoin trust into an exchange-traded fund (ETF). https://www.globenewswire.com/news-release/2021/08/04/2274526/0/en/Grayscale-Investments-Furthers-Commitment-to-Bitcoin-ETF-Hiring-Global-Head-of-ETFs.html

They started hiring people to transform GBTC into an ETF months, if not years ago.
They must be a very low productivity team...

My guess is that they want to be the first to turn into an ETF, but doing so in the most possible delayed way. As long they can postpone the ETF conversion, the more they can profit from the hefty 2% commission.

[XUNing]

Due to the structure of the trust, the trading price of GBTC shares is at a significant premium. Authorized and institutional investors can purchase GBTC stocks at NAV (Net Asset Value), but these stocks must be locked for six months before they can enter the secondary market.

[JayJuanGee]

Due to the structure of the trust, the trading price of GBTC shares is at a significant premium. Authorized and institutional investors can purchase GBTC stocks at NAV (Net Asset Value), but these stocks must be locked for six months before they can enter the secondary market.

I am not sure what you are saying XUNing.  From that top chart, it appears that GBTC stocks can be bought on the secondary market at about 10% below NAV, and I am not even sure if GBTC is selling actual shares at this time... Maybe you can explain the point that you were attempting to make a wee bit better?

[fillippone]

<…> the trading price of GBTC shares is at a significant premium. Authorized and institutional investors can purchase GBTC stocks at NAV (Net Asset Value), <…>

Please, read the thread before posting, or at least read the OP.
I am very welcoming on new users, who might not have understood something, but at least have demonstrated willingness to learn.

[fillippone]

As the ETF approval is still pending at the SEC, competitors try to dethrone Grayscale from their monopoly in the Trust market:

Wilshire Phoenix Takes Aim at Grayscale With Rival Bitcoin Trust

Wilshire Phoenix, a New York-based financial firm, has filed a new amendment to its wShares Bitcoin Commodity Trust (BCT) application. The initial filing was made back in June 2020 and is now expected to launch as early as October this year, assuming regulators green-light the product

Main differences

• No lockout period when purchasing shares
• Market making agreements on the secondary market
• Reduced fees

All these features should help keeping the fund’s NAV very close to market price.

[fillippone]

Gentle reminder: tomorrow is the last "big" unlock from Grayscale.



After this last unlock, we are essentially done: there aren't anymore locked shares:



Essentially, the Locked shares percentage dropped to zero:



Actual computation show the restricted percentage is now less than 1%, and it is going to drop more tomorrow.

I guess we can finally state the obvious: shares unlock had little to no effect on market price.

[Daltonik]

Four American asset management companies have purchased shares of the Grayscale Bitcoin Investment Trust (GBTC) fund:
1) Ancora Advisors announced the purchase of 13,945 shares of the Grayscale Investments bitcoin fund.  https://twitter.com/MacroScope17/status/1426288419819425792
2) Clear Perspective Advisors from Illinois owns 7,790 shares of GBTC. https://twitter.com/MacroScope17/status/1426314689856868354
3)Parkwood for the period from March 31 to June 30 increased the stake in the bitcoin fund from 93,000 to 125,000 shares. https://twitter.com/MacroScope17/status/1426207659032776709
4) Boston Private Wealth reported that it owns 103,469 shares of GBTC. https://twitter.com/MacroScope17/status/1426203621218267138

[oHnK]

Four American asset management companies have purchased shares of the Grayscale Bitcoin Investment Trust (GBTC) fund:
1) Ancora Advisors announced the purchase of 13,945 shares of the Grayscale Investments bitcoin fund.  https://twitter.com/MacroScope17/status/1426288419819425792
2) Clear Perspective Advisors from Illinois owns 7,790 shares of GBTC. https://twitter.com/MacroScope17/status/1426314689856868354
3)Parkwood for the period from March 31 to June 30 increased the stake in the bitcoin fund from 93,000 to 125,000 shares. https://twitter.com/MacroScope17/status/1426207659032776709
4) Boston Private Wealth reported that it owns 103,469 shares of GBTC. https://twitter.com/MacroScope17/status/1426203621218267138

In my opinion, it is natural for these 4 institutions to glance at and buy GBTC and ETHE because the crypto market has started to recover.  Even though what they buy is not BTC or ETH directly, yes because they are an investment manager company that has considered many things in the risk they choose.  The amount they buy is not so much when compared to the assets they have but with the successful performance of the crypto market and having a positive impact on GBTC and ETHE will make crypto in the eyes of institutional investors more sexy.  We need a lot of institutional investors to raise fundamental issues in the market so that what was previously predicted can be achieved.

[Cindella]

Institutions are increasing exposure to Grayscale Bitcoin Trust.

Grayscale Bitcoin Trust and Ethereum Trust both saw a large inflow of funds from institutions in the last quarter.

https://blockworks.co/institutional-capital-flows-into-grayscales-bitcoin-and-ethereum-trusts/

[James Watson]

Institutions are increasing exposure to Grayscale Bitcoin Trust.

Grayscale Bitcoin Trust and Ethereum Trust both saw a large inflow of funds from institutions in the last quarter.

https://blockworks.co/institutional-capital-flows-into-grayscales-bitcoin-and-ethereum-trusts/

It seems like Grayscale Premium is in a subtle uptrend since the capitulation event in May, this is an indication that institutions are re-convinced to hold BTC.

[fillippone]

Institutions are increasing exposure to Grayscale Bitcoin Trust.

Grayscale Bitcoin Trust and Ethereum Trust both saw a large inflow of funds from institutions in the last quarter.

https://blockworks.co/institutional-capital-flows-into-grayscales-bitcoin-and-ethereum-trusts/

It seems like Grayscale Premium is in a subtle uptrend since the capitulation event in May, this is an indication that institutions are re-convinced to hold BTC.

Well, this post didn't age (age?) well.
According to our spreadsheet, the premium has been breaking that "subtle uptrend" and collapsed again to more than 15%:



This has little to do with the restricted shares unlocking. As the below graph there are almost no locked shares left.


Actually, according to our spreadsheet, only  0.3% of the total shares are still locked, and they will be completely gone in two weeks time.

I guess you ware right when saying that flow are coming to GBTC: buying discounted GBTC shares and hedging those via selling the future is an "enhanched" cash and carry position more and more institutional players are willing to take.
This is beginning to get evident in the CME's COT:


https://twitter.com/skewdotcom/status/1427273606652993538?s=20

Buying a discounted GBTC shares, selling the future and cashing 15% discount (eventually rolling the maturity) is a too low hanging fruit not to be picked up!

[Karartma1]

That's a market that's not accesible for most of us. As usual the filthy riches can get these low hanging fruits as you call them but we can't nothing but peanuts.
I hope GBTC dies soon and never get converted in an ETF. They've to disappear, they've been nothing but a roadblock towards better investment vehicles.
Sorry, I'm a bit nervous these days.

[JayJuanGee]

That's a market that's not accesible for most of us. As usual the filthy riches can get these low hanging fruits as you call them but we can't nothing but peanuts.
I hope GBTC dies soon and never get converted in an ETF. They've to disappear, they've been nothing but a roadblock towards better investment vehicles.
Sorry, I'm a bit nervous these days.

Direct ownership of BTC is a better product, so I don't understand why you give very many shits about rich fucktwats are using to get their BTC exposure.

Hey, don't get me wrong, if you are enrolled in some financial program in which one of the options is GBTC, then sure, you might want to play around with that, including the taxed deferred aspect, but there is more to bitcoin than merely something that could be taxed deferred.. and sure, as an individual, you could set up part of your BTC funds for direct management and taxed deferred as well.. if you were to want that kind of option, which would take some fees to set up and get used to how to do it without violating rules related to that (and those rules are likely to change from time to time, too.. and perhaps even differ state by state and jurisdiction by jurisdiction if outside of the USA).. .

having a foot in both worlds can give you options too.. but there are constant developments in bitcoin as well in terms of potentially having your foot in a variety of words, whether we are talking about various kinds of onchain holding of bitcoin, holding bitcoin through various third parties that are available to you or holding bitcoin on lightning network..

On a a personal level I have never even really thought about whether or not I could get exposure to buying BTC through GBTC, whether directly or on secondary markets, and I don't feel like I am missing anything either, even though I know that there are various ways that I could purposefully cause my lil selfie to get access to GBTC.. but why the fuck would I want to jump through a bunch of hoops and to thereafter feel that I am getting more value.. such purported extra value of such an option is not really that tangible in my thinking Karartma1 even though you want to whine about something that you are feeling as something you are missing out on.. .

Oh and another thing.. one of the greatest as fuck things about bitcoin for poor people who might only have had $5 a week of extra potentially investable income (but actual knowledge of bitcoin and willing to invest directly into bitcoin), is that they could have actually been buying BTC and if they had been doing that for the past 9 years, since 2012, they would already have stacked up about 15 bitcoin (even though they had only invested $2,350 during that time. and pretty damned great front-running returns with a current value of about $710k ... and fuck GBTC.. who gives any shits because this kind of an of insightful poor person could actually held and managed their bitcoin directly and in ways that they can really say fuck you with it..

Quite a great way for poor people to front run the fuck out of both less flexible folks who are invested in financial products and to also front run status quo rich folks who have had little to no clue about bitcoin but they have traditionally had desires to lock normies out of investment opportunities that have only traditionally been available to the status quo connected folks..so part of the power of bitcoin is not needing that kind of insider access (but insider knowledge about bitcoin is good and abilities to excercise long term HODLer thinking and persistent accumulation would have been powerful, even though not many poor peeps have that kind of discipline, either.. even though it would be in their capacities to hone such skills, even with a 7th grader level of formal education).

[fillippone]

That's a market that's not accesible for most of us. As usual the filthy riches can get these low hanging fruits as you call them but we can't nothing but peanuts.
I hope GBTC dies soon and never get converted in an ETF. They've to disappear, they've been nothing but a roadblock towards better investment vehicles.
Sorry, I'm a bit nervous these days.

There are already many other, better, investment options.
But remember each of them is sub-optimal to invest directly into Bitcoin.
And if you are writing here, I bet you already know that.

So don't be in anger, but know that you are way in advance of the mass adoption of bitcoin.
Also remember that, quoting Jameson Lopp:

Bitcoin isn't a get rich quick scheme, it's a don't get poor slowly scheme.

https://twitter.com/lopp/status/1171847107243859968?s=20

Hope it helps to calm you down.

[JayJuanGee]

That's a market that's not accesible for most of us. As usual the filthy riches can get these low hanging fruits as you call them but we can't nothing but peanuts.
I hope GBTC dies soon and never get converted in an ETF. They've to disappear, they've been nothing but a roadblock towards better investment vehicles.
Sorry, I'm a bit nervous these days.

There are already many other, better, investment options.
But remember each of them is sub-optimal to invest directly into Bitcoin.
And if you are writing here, I bet you already know that.

So don't be in anger, but know that you are way in advance of the mass adoption of bitcoin.
Also remember that, quoting Jameson Lopp:

>>>>>>>>
Bitcoin isn't a get rich quick scheme, it's a don't get poor slowly scheme.
<<<<<<<<<

https://twitter.com/lopp/status/1171847107243859968?s=20

Hope it helps to calm you down.

Karartma1 needs something like a batman slap.. or maybe something stronger in order to calm him the fuck down.. maybe the "airplane scene" would work.  Perhaps?  perhaps?

Many of us can appreciate that it does tend to be quite helpful to instruct someone to calm down, also (as you already did that fillippone.. so we are likely to see positive effects from that).

 

[Karartma1]

Batman slap would maybe help.
Like I said being nervous these days doesn't help.
I don't really care about these investment vehicles, they're just snake-oil in front of those who I 've called rich kidz.
I prefer the real deal, like all of you.

[JayJuanGee]

Batman slap would maybe help.
Like I said being nervous these days doesn't help.
I don't really care about these investment vehicles, they're just snake-oil in front of those who I 've called rich kidz.
I prefer the real deal, like all of you.

That's the spirit, Karartma..

Just the mentioning of a batman slap seems to have cheered you up a bit... and maybe our recent move from $45,500 to $49,164 in the past 24 hours has not hurt on-the-spot sentiments, either?

[Karartma1]

I know, I know even my closest friends sometimes get to tell me I'm a pain in the ass on some things.
Looking at the market these days I can't complain but I never really can't complain. DCA works good (thanks to you too jjg).
I'll leave GBTC shares and profits to the institutionals, while I keep stacking sats in any possible way.
See ya around here guys.

[JayJuanGee]

I know, I know even my closest friends sometimes get to tell me I'm a pain in the ass on some things.
Looking at the market these days I can't complain but I never really can't complain. DCA works good (thanks to you too jjg).
I'll leave GBTC shares and profits to the institutionals, while I keep stacking sats in any possible way.
See ya around here guys.

That's great.

Just consider how many peeps who got scared from this most recent 56% dip that lasted 2-3 months.. and sure we are not even fully recovered from it yet (even though it is seeming quite convincing that the bottom is in) - and of course one additional levels of complication with GBTC, because they dipped even further in their going from a premium to a negative.. while they also reflect spot price too... so they had a dip of their premium that arguably started 4-5 months before BTC's spot price started to fall in this latest dip.. with a double whammy.

Many of us wee peasants could have gotten paralyzed or even run out of money on the way down, but a DCA strategy would still suggest to at least hold some of your money aside to be continuing with the DCA strategy, whether it is $10 per week, $25 per week, $100 per week or some other amount that might be more or less aggressive depending on personal financial and psychological circumstances. 

GBTC would not have been so easy as to allow for such "peasant" tailoring... at least not the initial product, even if more tailoring might have been possible for some of the guys who are able to participate in GBTC secondary markets... complicated, no?

And the guy who directly bought BTC through all of this time including the one who aggressively directly stacked BTC for $100 per week over the past 8 years would have already gotten himself about $2.5 million in current spot price value (about 55 BTC), which surely puts that same DCAing guy in the league of some of the GBTC investors (even if he might not have initially qualified for getting into GBTC when he first got started into buying BTC directly).

 Of course, mistakes are frequently made along the way too and people do not necessarily learn a focused technique when the first get started in buying BTC .. and the volatility can really throw off a lot of people, but they can still evolve into a more aggressive and consistent DCA strategy - and hopefully without messing up his/her own cashflow along the way and hopefully not getting scared out of his/her DCA strategy that so far has been proven to be one of the best of strategies in staying actively involved in BTC accumulation - and the longer the time doing it, the better it has been historically for the DCAing accumulators involved in BTC.

One of the problems of the peasant could be that s/he might not have any other investment or any other investment opportunities, so s/he might get scared away from ongoing BTC investing in a DCAing kind of way because after a while and s/he might start to accumulate so much relative wealth in BTC, then s/he may start to feel way over allocated into BTC at various points when the BTC price is going up.. so anyone involved in BTC for nearly 8 years has gone through close to two full cycles, even though many of us will suggest that the first full cycle might feel like the worst in terms of feeling some financial/psychological insecurity, but even the longer term BTC accumulator.. might get scared away from some of the ongoing DCA'ing too and part of that might well be due to the considerable outperformance that BTC has historically shown, relative to any other investment category.. which can be quite difficult to manage financially and psychologically.

Let's consider the possibility that the one who had been able to be more aggressive with $100 per week might ONLY have an income of a couple thousand per month.. so gosh when their whole BTC holdings has appreciated to such relatively large sums of money.. there are going to likely be many points along the way in which they are going to be very tempted to either draw from their BTC holdings or to put such value into other investments (which none of us can really blame them from having and even acting on such temptations).  Sure, I am not talking about reallocating into shitcoins here.. I am just referring to equities, property, PMs and even cash. even if maybe the ongoing investor could still consider that BTC remains as the best of investments and they could still continue to DCA into BTC - even if they remain vastly overallocated in BTC.  These are tough decisions for a lot of us, even for many of us who have been in BTC for a long time, even though the first full cycle is likely the most difficult, relatively speaking in terms of getting to a larger BTC investment portfolio size, which could also tempt normies into screwing things up in one way or another.. so none of us is completely immuned.

[Karartma1]

I think the biggest differentiator that puts the DCA guy into another league is the fact that those DCA guys who combined their money with their knowledge basically did bingo. IMO one thing's to blindly accept a DCA strategy, other thing's too put the strategy forth because one's recognizing the value of the underlying asset!
I mean I could have done DCA with stocks but naming some names would put this strategy into oblivion.
You got the point.
Bitcoin + DCA is a kind of Universal Law to me now.