Grayscale Bitcoin Trust Shares Surge to Yearly High, Discount Drops to 30%

Grayscale Bitcoin Trust (GBTC), a trust that holds bitcoins, rose sharply in value to a record high of $1.01 on Tuesday. A report that Fidelity Investments is preparing its own filing to replace BlackRock with a Bitcoin (BTC) spot-exchange-traded fund (ETF) reinforced optimism about converting that trust into an ETF.

GBTC closed at $19.47 on Tuesday, up 7.1% on the day. TradingView data shows that this was the highest price for a deal since June of last year. Except for a brief surge to $31,000 following the Fidelity announcement, BTC was largely flat.

According to AskFX analysis, the discount in GBTC stock prices relative to their net asset value — a widely used metric for digital assets — has fallen to 30%. The last time GBTC reached this level in a single day was in September of last year, according to Ycharts.

Tuesday’s price surge continued GBTC’s recent rally. The trigger was initially BlackRock’s filing on June 15 and then continued as financial services giants Invesco and WisdomTree filed another filing for spot BTC ETFs. GBTC is up almost 50% since BlackRock filed its application. BlackRock has $9.1 trillion in assets under management, making it the largest wealth manager in the world.

BlackRock’s proposal and investor optimism drive GBTC to invest heavily. [the firm] Grayscale may also convert the ETF and remove the rebate, Doug Schwenk, CEO of crypto data provider Digital Asset Research, said in an email to AskFX.

Schwenk added that traders are becoming more optimistic about the outcome of a lawsuit Grayscale has filed against the US Securities and Exchange Commission. The company filed a lawsuit against the SEC earlier this year after denying its request to convert GBTC’s closed-end fund into an ETF, allowing for redemptions and closing the gap between stock prices in the secondary market and the value of each BTC it holds -Share would have decreased funds.

He added that a positive result for Grayscale could make it more likely to be listed as an ETF and the discount removed. Some people believe BlackRock’s filing is also a possible preview of Grayscale’s success in its lawsuit.