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

[franky1]

grayscale want the outflows.. they want to remove their ownership of so much coin.. its a liability that can be taken by the courts in the bankruptcy litigations of DCG sister companies

grayscale then want to make a secondary ETF where they dont "own" the baskets, but instead just manage other brokers baskets

https://www.grayscale.com/blog/general-updates/what-is-grayscale-bitcoin-mini-trust
they want brokers to buy grayscale(dcg) owned coin of what was 630k in december 2023.. and move it out of grayscale gbtc ownership, and into other etf(eventually hope of grayscales non-self-coin owned etf offering of the 'mini'
and then the brokers own the coin and lock it into coinbase for coinbase(dcg sister) to manage and grayscale(dcg sister) to manage, without ownership by any DCG sister

[bbc.reporter]

@JayJuanGee. It makes it appear that the Ethereum promotions and marketing propaganda is very successful if they can make people think that every fee relating to the cryptospace can be called a gas fee hehehehe.

@franky1. Does that imply Grayscale will never lower their management fees? They would not have announced to lower it if they did not want it, I reckon.

[OcTradism]

@JayJuanGee. It makes appear that the Ethereum promotions and marketing propaganda is very successful if they can make people think that every fee relating to the cryptospace can be called a gas fee hehehehe.

Gas fee is for EVM blockchains and it does not apply for Bitcoin blockchain and even Bitcoin forks Proof of Work.

Recent weeks, I saw many posts on X platform with Ethereum Gas Fee Refund. Misleading scam posts like "I receive $x,xxx of gas fee refund from Ethereum" is very annoying.

I reported many posts in X Ads but X platform and their staffs didn't do anything to stop those scam Ads.

[franky1]

@JayJuanGee. It makes it appear that the Ethereum promotions and marketing propaganda is very successful if they can make people think that every fee relating to the cryptospace can be called a gas fee hehehehe.

@franky1. Does that imply Grayscale will never lower their management fees? They would not have announced to lower it if they did not want it, I reckon.

i reckon they will either:
get down to a safe hoard amount of GBTC(still have some grayscale owned coin locked) before lowering fee's of gbtc)
or
more savvi just get a 'mini' approved(if approved that is) and just empty GBTC and get brokers to basket up coin in the mini and let the GBTC die out

but their main game is to have high fee's to not have brokers in GBTC adding baskets(coin/shares).. because they want AP's trying to get current grayscale owned basket shares dissolved and converted into btc to sell off so grayscale can de-risk themselves of having a huge coin hoard in ownership

[fillippone]

Just wondering if we have just witnessed the last round of outflows from GBTC.
Now that presumedly Genesis has finished selling, I can't see why anyone else should do so: New buyers are focusing on IBIT and FBTC, instead of the legacy fund. We might be near the bottom in GBTC.

[franky1]

Just wondering if we have just witnessed the last round of outflows from GBTC.
Now that presumedly Genesis has finished selling, I can't see why anyone else should do so: New buyers are focusing on IBIT and FBTC, instead of the legacy fund. We might be near the bottom in GBTC.

just witnessed? its the weekend, buys(to dissolve shares  and outflow coin holdings) die down at weekends
..also it was US spring break and about to be other countries easter break.. so expect slowdown. even traders need a holiday

also GBTC buyers(to then request dissolving shares to move coin out to exchanges(outflows) to then move into other etf(inflows)) are not done by end user investor buyers of shares (meaning not done by your grandparents, your parents, your pension)
its actual 100% AP(brokers(agents/sponsors)).. emphasis, not your grandparents..  not end investors

[fillippone]

Just wondering if we have just witnessed the last round of outflows from GBTC.
Now that presumedly Genesis has finished selling, I can't see why anyone else should do so: New buyers are focusing on IBIT and FBTC, instead of the legacy fund. We might be near the bottom in GBTC.

just witnessed? its the weekend, buys(to dissolve shares  and outflow coin holdings) die down at weekends
..also it was US spring break and about to be other countries easter break.. so expect slowdown. even traders need a holiday

also GBTC buyers(to then request dissolving shares to move coin out to exchanges(outflows) to then move into other etf(inflows)) are not done by end user investor buyers of shares (meaning not done by your grandparents, your parents, your pension)
its actual 100% AP(brokers(agents/sponsors)).. emphasis, not your grandparents..  not end investors

Nice analysis, but I guess all the GBTC recent selling was about Genesys selling shares and using proceeds to buy BTC (sort of neutral market move).
The thing is that buying from IBIT and FBTC also slow down.
Wondering what is driving what. GBTC driving inflows or the other way around? 

[fillippone]

Grayscale finally announced the fee rate on their Bitcoin Mini Trust ETF: they are offering a very competitive 0.15% fee ratio.


The SEC filing also showed they seeded the funds with 63,204 Bitcoin.

This was is a huge amount, almost 10% of total funds. So I think they are going to “airdrop” this to their current customers.
Of course, this will act as a de facto fee reduction of almost 9%, as, of course, this switch event won’t be taxable.
So I guess the outflows from GBTC will go on in the future, but at least there will be a lesser outflow from broad Grayscale products.

[bbc.reporter]

News update. The CEO of Grayscale Michael Sonnenshein has resigned. It appears the cause of this might be because of his mistake of not quickly decreasing their fees to the more competitive rates on the ETF market after the approval? The expensive fees might have also been the cause of the big outflows from GBTC. Michael Sonnenshein will be replaced by Peter Mintzberg from Goldman Sachs. He was congratulated by Barry Silbet which might also imply that this is his decision.



Grayscale Investments, one of the world’s largest crypto asset management firms, has appointed Peter Mintzberg as its new chief effective officer, effective August 15, 2024.

Mintzberg, a seasoned strategist with over twenty years in asset management, will also join Grayscale’s Board of Directors.

Previously, Mintzberg held the position of global head of strategy for asset and wealth management at Goldman Sachs and has served in leadership roles at BlackRock, OppenheimerFunds, and Invesco.

Source https://finance.yahoo.com/news/grayscale-investments-names-peter-mintzberg-173918411.html

[JayJuanGee]

News update. The CEO of Grayscale Michael Sonnenshein has resigned. It appears the cause of this might be because of his mistake of not quickly decreasing their fees to the more competitive rates on the ETF market after the approval? The expensive fees might have also been the cause of the big outflows from GBTC. Michael Sonnenshein will be replaced by Peter Mintzberg from Goldman Sachs. He was congratulated by Barry Silbet which might also imply that this is his decision.

Grayscale Investments, one of the world’s largest crypto asset management firms, has appointed Peter Mintzberg as its new chief effective officer, effective August 15, 2024.

Mintzberg, a seasoned strategist with over twenty years in asset management, will also join Grayscale’s Board of Directors.

Previously, Mintzberg held the position of global head of strategy for asset and wealth management at Goldman Sachs and has served in leadership roles at BlackRock, OppenheimerFunds, and Invesco.

Source https://finance.yahoo.com/news/grayscale-investments-names-peter-mintzberg-173918411.html

I had heard that the NY attorney general's settlement with Genesis from right around the same time of the announcement of Sonnenshein's resignation might have also had some potential connection to the whole matter, and yeah there could be a variety of explanations (and considerations) that are not necessarily made public.. that may or may not end up coming out of the woodwork at some later date.

https://www.cnbc.com/2024/05/20/new-york-ag-announces-2-billion-settlement-with-crypto-lender-genesis.html

[fillippone]

It might be a little bit OT, but I heard Grayscale is crossing the t’s and dotting the i’s on their S-1,form for a mini-ETH ETF.
Really curious about the fact they learnt something from the disastrous BTC ETF launch.
Maybe we won’t witness the same AUM bleeding?

[Daltonik]

On August 22, Ggrayscale nvestments announces the launch of a new closed-end fund product - Grayscale Avalanche Trust(AVAX). Grayscale Avalanche Trust will be supplemented with funds based on MKR and SUI tokens, in particular.

https://www.globenewswire.com/news-release/2024/08/22/2934225/0/en/Grayscale-Investments-Launches-Grayscale-Avalanche-Trust.html
https://cointelegraph.com/news/grayscale-launches-investment-fund-avax-token

https://x.com/Grayscale/status/1826605888196804973

[franky1]

because eth just shadow traces(pegs) btc prices at a 22:1 ratio


many EFT holders are finding the idea of an eth EFT being a boring proposition, with more downside if it crashes due to eth problems, so they might aswell just stick with strong value store BTC EFT thats not being artificially propped up like eth is

so the ETF managers are instead planning and moving to offer other crypto that are not just shadow tracing btc prices. which seems to be them trying to follow the avalanche project as its a project made by the fiat industry so you can see why they would want to turn their old investment(into creating it) into a ROI opportunity of an ETF

the next stage after this is to create a handful of diverse ETF's and then a master index fund that swaps in and out certain crypto ETF as they rise and fall(sell high buy low) to then offer a high performing index fund.. but this index fund is a later chapter in the ETF planbook.. they first need to apply and get a handful of crypto ETF accepted and running

..
personally, them choosing(from Daltonik posts) sol and MKR is not something i think thats independent market/diverse enough to have as an opposing ETF to swap between when BTC shifts its market. as you can see below MKR and SOL are still kinda following the trends of BTC, though less comparable to eth which is highly pegged to trace BTC

[fillippone]

many EFT holders are finding the idea of an eth EFT being a boring proposition, with more downside if it crashes due to eth problems, so they might aswell just stick with strong value store BTC EFT thats not being artificially propped up like eth is

I have always wondered who on his right mind would buy an ETH ETF.

An ETH ETF has a negative cost of carry in ETH terms: if you hold ETH you can easily stake it and gain a nice 3% APY. Not much, but honest work.
With an ETH ETF you cannot get that yield, plus you pay the fees to the issuer.

No sense.
So if you want an ETF pegged to the "crypto" but a BTC ETF, far more liquid and efficient.
If you like ETH, buy the real thing and stake it natively.

Buying an ETH ETF targets a minuscule intersection of boomers wanting to gain exposure to an obscure shitcoin.

[SilverCryptoBullet]

I have always wondered who on his right mind would buy an ETH ETF.

An ETH ETF has a negative cost of carry in ETH terms: if you hold ETH you can easily stake it and gain a nice 3% APY. Not much, but honest work.
With an ETH ETF you cannot get that yield, plus you pay the fees to the issuer.

No sense.
So if you want an ETF pegged to the "crypto" but a BTC ETF, far more liquid and efficient.
If you like ETH, buy the real thing and stake it natively.

Buying an ETH ETF targets a minuscule intersection of boomers wanting to gain exposure to an obscure shitcoin.

With ETH ETF, they don't have actual ETH and they trust the issuer and another company that plays as a custodian for the issuer, to secure their ETH. They have to trust two entities, the ETH ETF issuer and the wallet custodian. Risk is big with one entity and is bigger with two entities.

If they purchase ETH and stake it, they at least have ETH but only take risk by staking it. The advantage is they will earn yield by staking.

In financial math, ETH ETF is not good, I agree with you.

If they purchase ETH and stake it, they earn more 3% while ETH has burn that will make their 3% earning has more value in future.
https://ultrasound.money/

Burn: 63k ETH/ year
Issuance: 944k ETH/year
Supply growth: +0.73%/year

[fillippone]

I have always wondered who on his right mind would buy an ETH ETF.

An ETH ETF has a negative cost of carry in ETH terms: if you hold ETH you can easily stake it and gain a nice 3% APY. Not much, but honest work.
With an ETH ETF you cannot get that yield, plus you pay the fees to the issuer.

No sense.
So if you want an ETF pegged to the "crypto" but a BTC ETF, far more liquid and efficient.
If you like ETH, buy the real thing and stake it natively.

Buying an ETH ETF targets a minuscule intersection of boomers wanting to gain exposure to an obscure shitcoin.

With ETH ETF, they don't have actual ETH and they trust the issuer and another company that plays as a custodian for the issuer, to secure their ETH. They have to trust two entities, the ETH ETF issuer and the wallet custodian. Risk is big with one entity and is bigger with two entities.

If they purchase ETH and stake it, they at least have ETH but only take risk by staking it. The advantage is they will earn yield by staking.

In financial math, ETH ETF is not good, I agree with you.

If they purchase ETH and stake it, they earn more 3% while ETH has burn that will make their 3% earning has more value in future.
https://ultrasound.money/

Burn: 63k ETH/ year
Issuance: 944k ETH/year
Supply growth: +0.73%/year

ETH is now inflationary after the Dencun upgrade reduced on-chain fees.
Not having a staking yield is thus very punishing for ETH ETF holders.
It is punishing for every ETH hodler.
And the cross rate is going south for a reason.

Lastly, the trust issue is the same of a BTC ETF, actually.

[SilverCryptoBullet]

ETH is now inflationary after the Dencun upgrade reduced on-chain fees.
Not having a staking yield is thus very punishing for ETH ETF holders.
It is punishing for every ETH hodler.
And the cross rate is going south for a reason.

It's inflation rate after Dencun ugrade is about 0.7% annually and it is no longer deflationary because source to burn ETH from on-chain transaction fees is less than before Dencun.

Its deflationary lasts for about 1 year and some months from November 2022 till January 2024, the supply growth chart from Etherscan shows it.
https://etherscan.io/chart/ethersupplygrowth