Premium Rate of Publicly Traded Bitcoin Trust Breaks All-time Low

• Grayscale Bitcoin Trust has fallen to an all-time low by over 40%.
• Its assets under management equivalently fall below the $10 billion price cap.
• Public trusts offer retail investors a safer alternative to direct crypto-investing.

According to data from the market tracking site CoinGlass, the premium rate of Grayscale Bitcoin Trust (GBTC), a publicly traded investment vehicle, has fallen to an all-time low.

GBTC’s premium rate is currently at negative 40.73%, with a significant 30-day change of negative 1,149. Contextually, the premium rate refers to the difference between the value of the assets held by the trust against the market price.

Grayscale’s total holdings, or assets under management (AUM), is 633,840 units of Bitcoin, equivalent to below the $10 billion price cap. Notably, the Ethereum Trust, Grayscale’s second-largest fund, is in no better condition. Its premium rate also fell by over 32% in 24 hours, bringing its AUM to around $3.4 billion.

Furthermore, GBTC, EETH, and other investment trusts are 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.

In June this year, the US Securities and Exchange Commission (SEC) declined Grayscale’s proposal to convert to a spot Bitcoin exchange-traded fund (ETF). The SEC decided after GBTC’s committee failed to answer critical questions concerning preventing market manipulation and investor protection. Although Grayscale revealed, in an investors letter, that in a public survey the SEC conducted from the previous year, 99.96% of the respondents supported Grayscale’s case.

In other news, the crypto market has continued the bleeding cycle, with Bitcoin dropping to two years all-time low. Bitcoin currently trades at $16,851.72, with a cumulative seven-day low of over 18%.