The Bitcoin (BTC) trust controlled by digital asset management titan Grayscale is flashing signs of life following BlackRock’s latest filing for an exchange-traded fund (ETF) designed to track the crypto king’s performance.
The Grayscale Bitcoin Trust (GBTC) rose more than 12% on Friday, a day after $10 trillion investment firm BlackRock submitted a spot Bitcoin ETF filing to the U.S. Securities and Exchange Commission (SEC).
Grayscale’s GBTC traded at a hefty discount to its net asset value (NAV), but its latest rally has Allowed the Bitcoin trust to close the gap from 44.03% on June 13 to 36.61% on June 16.
Adam Cochran, partner at family firm Cinnamhain Ventures, believes that GBTC will be a big winner if the SEC approves BlackRock’s application.
“If the Blackrock ETF is approved, GBTC will be the real winner
Because Blackrock will show the path to conversion and GBTCs [30%+] discount will be resolved on top of industry growth.
Earlier this year, Grayscale CEO Michael Sonnenshein stressed the importance of converting GBTC into a spot Bitcoin ETF. According to Sonnenshein, GBTC’s conversion will allow the trust to trade near par with Bitcoin’s spot price, adding billions of dollars to investors’ holdings as the discount evaporates.
“Because GBTC today trades at a discount to its NAV, if it converted to an ETF, there would be no discount, but there would be no premium. There would be that arbitration mechanism embedded…
What does that mean? That means there are, in effect, a few billion dollars of capital that would immediately disappear into investors’ pockets overnight because, instead of trading at a discount, the fund would rebound to its net asset value.”
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