Bitcoin PriceCointelegraph.comCryptocurrenciesGrayscaleMarket AnalysisMarkets

Grayscale halts GBTC inflow after record 15% discount

Just a few days after GBTC traded at a 15% discount to its BTC equivalent, Grayscale Investments has temporarily closed the trust to investors.
Grayscale Investments’ GBTC Bitcoin Trust has been under the heat for the last couple of weeks as it traded below the BTC equivalent for each share. The instrument trades on over-the-counter markets and is by far the largest listed cryptocurrency asset.Periodically, the private-placement offerings for GBTC shares are temporarily closed, as well as similar products offered by Grayscale Investment such as the Ethereum Trust. As of March 7, both GBTC and the Digital Large Cap Fund (GDLC) are under such periods.The fact that the only investment vehicles containing Bitcoin (BTC) have temporarily closed their issuance and the timing of the pause seems a bit odd as GBTC reached a record-high 15% discount to the BTC-equivalent for each share on March 5.Grayscale Bitcoin Trust landing page. Source: GrayscaleGBTC shares used to trade above the equivalent BTC held by the trust, an effect caused by the excess retail demand. Meanwhile, institutional clients were able to buy shares directly from Grayscale at par.This demand-instability created an arbitrage opportunity where clients could buy at par directly from Grayscale Investments, hold their shares for the 6-month lock-up period, then sell them on secondary markets with a premium attached.Grayscale Bitcoin Trust premium to BTC. Source: TradingViewThis strategy yielded excellent results as the GBTC premium over its BTC equivalent content ranged from 5% to 40%. It is worth noting that excess demand on secondary …
Story continues on Cointelegraph

Related posts
BitcoinBitcoin NewsbtcusdBTCUSDCBTCUSDTMarketsNewsxbtusd

If this historic pattern plays out, Bitcoin will smash $300k in no time

Historically bullish patterns have been trailing the Bitcoin market scene, signaling a potential price pump to a new all-time high. Like many other indicators, a bullish pattern has once again been spotted. This time, the estimated price unseats all previous…
BusinessDigital Currency GroupGBTCGrayscale

Grayscale’s Parent Company to Buy $250M Bitcoin via GBTC

Digital Currency Group (DCG), the parent company of Grayscale LLC, has invested $250 million in Bitcoin using Grayscale’s Bitcoin Trust shares.  DCG Taps Grayscale’s GBTC Discount In compliance with SEC laws, DCG filed form Rule 10b-18 to inform shareholders about…

Blockchain group INATBA reiterates concerns over proposed European regulations

The International Association for Trusted Blockchain Applications has faulted some aspects of the European Commission’s proposed crypto regulations. Six months after its first response to the European Commission’s crypto legislative proposal, the International Association for Trusted Blockchain Applications, or INATBA,…