- Grayscale Bitcoin Trust has fallen to an all-time low by over 43%.
- GBTC trades at $9,562 per BTC, compared to the $16,813 current BTC market value.
- Public trusts offer retail investors a safer alternative to direct crypto-investing.
Data from the market monitoring platform CoinGlass shows that the premium rate of the world’s largest institutional Bitcoin fund, the Grayscale Bitcoin Trust (GBTC), is in terrible condition.
GBTC’s premium rate has plunged further by negative 42.73%, with a significant 30-day change of negative 1,045. The premium rate is the discrepancy between the market price and the value of the assets owned by the trust. Therefore, Grayscale’s Bitcoin Trust trades at about $9,562 per Bitcoin (BTC), compared to the current BTC’s market value of $16,813.
Grayscale’s total holdings, or assets under management (AUM), is 633,570 units of Bitcoin, equivalent to above the $10 billion price cap. Notably, the Ethereum Trust (EETH), the second-largest fund at Grayscale, is in no better shape. In 24 hours, its premium rate dropped by more than 40%, bringing its AUM to about $3.68 billion.
Consequently, EETH is trading at a 41% discount, at around $718 per Ethereum, instead of the approximate $1,219 market price.
Essentially, GBTC, EETH, and other publicly traded trusts represent a pool of crypto-related assets traded on traditional exchanges, similar to crypto futures contracts. They offer retail investors who are uncomfortable investing in cryptocurrencies an alternative to investing without owning them.
The continuous decline in the prices of these public trusts may be due to the recent FTX exchange fiasco, shaking the confidence of both retail and institutional investors. The global crypto market cap also lost the recently reclaimed one trillion dollar cap after BTC dropped to its two-year lows.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
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