1/ I have a theory why @grayscaleinvest is buying so many #Bitcoins yet price doesn't budge. Spare 3 mins and I'll take you down the rabbit hole. First of all you need to understand GBTC trades at a premium to the held. Each share holds 0.00096112 BTCs, as shown below
2/ This gives us a Net Asset Value (NAV) of $9800 x 0.00096112 = $9.42, while GBTC US closed at $11.73. That' a hefty 24% premium, which used to be a lot higher as you can see @ ycharts.com/companies/GBTC… Keep in mind only accredited investors can buy directly from @grayscaleinvest
3/ meanwhile plebs who do not have $1 million investments gotta buy on secondary markets using their regular stock brokers. 401k vehicles, e*trade and robinhood retail traders have no other way for Bitcoin exposure. Then comes the lock up period...
4/ dicated by SEC's Rule 144, not allowing investors to sell their restricted securities (such as GBTC) for 6 to 12 months depending on reporting requirements. This means one can not buy from Grayscale and immediately dump to make a quick buck.
5/ That's why premium was so large and took years to reduce -- yet, it still remains. Question is: could someone be buying directly from Grayscale while simultaneously dumping spot (or futures) BTC in order to capture this premium in 6 months time?
6/ This could partially explain how GBTC has bought 28k since halving, as @kerooke charted @ - not causing a price impact. I still don't understand why this entity has been spreading this trade over so many days/weeks. Any good theories out there?
fin/ Anyway, this player will be making lots of $$ over the next bull run, as premium might reach 40% plus. Hats off to this guy. @barrysilbert @Sonnenshein Does it make sense? Any comment you guys might add?
ps: my good friend Alexandre from BLP Asset reminds me that those institutional investors can hand out their own BTC in order to 'buy' the GBTC shares
Bottom line: FAKE NEWS. Grayscale hasn't been buying 180% equivalent of all mined coins since halving
congrats @zhusu !
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