Grayscale Bitcoin Trust Discount Sees 16% Decline
The Grayscale Bitcoin Trust (GBTC), the largest Bitcoin fund globally, experienced its lowest point in 22 months recently. This decline in the discount has led to optimism as spot Bitcoin exchange-traded funds (ETFs) in the United States are getting closer to approval.
The Securities and Exchange Commission (SEC) missed the deadline to appeal against Grayscale’s attempt to convert GBTC into a spot Bitcoin ETF, which adds to the positive outlook.
Grayscale Bitcoin Trust Discount Narrows
Recent data from YCharts reveals that GBTC shares were traded at a 15.87% discount on October 13th compared to the trust’s net asset value (NAV). This is the lowest level since December 2021 when Bitcoin’s price reached its peak near $69,000.
The discount on GBTC began decreasing when BlackRock and other financial institutions applied for spot Bitcoin ETFs in mid-June. Within three weeks, the discount dropped from 44% to 26.7% and has continued to narrow since then.
The “Discount to NAV” measures how much a mutual fund or ETF is trading below its net asset value. This metric helps determine the deviation of a security’s trading value from its intrinsic worth.
Potential Approval of Spot Bitcoin ETF
The SEC had until October 13th to appeal its dispute with Grayscale Investments regarding the establishment of a spot Bitcoin ETF. Although a failure to appeal doesn’t guarantee approval, it suggests that the court may uphold its directive for the SEC to review Grayscale’s request.
Industry observers are optimistic about potential approval, with Bloomberg ETF analysts increasing the odds to 90% after Ark Invest and 21Shares updated their spot Bitcoin ETF prospectus as requested by the SEC.
Hot Take: Optimism Grows as Grayscale Bitcoin Trust Reaches Lowest Point in 22 Months
The recent decline in the discount of Grayscale Bitcoin Trust (GBTC) has sparked optimism in the cryptocurrency community. With spot Bitcoin exchange-traded funds (ETFs) moving closer to approval and the SEC missing the deadline to appeal against GBTC’s conversion into a spot Bitcoin ETF, there is hope for progress in the industry.
GBTC’s discount has been consistently narrowing, indicating increasing market confidence. The recent data shows the lowest level of discount since December 2021, reflecting positive trends for investors.
While there is no guarantee of approval, industry observers remain hopeful, with analysts raising the odds of a spot Bitcoin ETF approval to 90%. This development, along with the narrowing discount on GBTC, suggests a potentially bright future for cryptocurrency enthusiasts.
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