Historically, the GBTC premium has been quite high. It measured about 40% last month. However, data from Skew on Feb.2 confirmed that this statistic fell to -1.5% before recovering slightly.
The decrease in premiums may be due to increased sales by accredited investors or a lack of demand for GBTC from non-accredited investors at this price. This lack of demand for GBTC may also be due to increased competition in the market and divert demand elsewhere.
This was highlighted in a recently published article:
“Corporate purchasing is an investment in GBTC, and institutions buy GBTC in return for a premium. Demand is expected to drop when premium falls, and that’s what happens. What does this entail? The decline in demand indicates that there may be a pause or worse a halt in corporate GBTC buying, and this also highlights the possibility of a retraction of Bitcoin demand.
Trust products increase in interest
Although the SEC has not yet approved a Bitcoin ETF in the United States, a number of companies have recently submitted applications pointing to their intention to offer a Bitcoin investment Trust tool. The most recent of these was BlockFi, which filed it on January 29th.
Investing in GBTC has long been a popular business for many institutions. Three Arrows Capital recently announced a position of over $ 1.2 billion in Grayscale’s Bitcoin Trust.
However, given the current scenario, the downside of discounted GBTC trading can be quite significant.
