Grayscale Bitcoin Trust (GBTC), the world’s largest bitcoin (BTC) fund has seen its discount touching to an all-time low of 30.79% this week as crypto market suffered one of the most bearish weeks in recent times.
GBTC Hits an All-Time Low Discount of 30.79%
According to the recent data from YCharts, shares of the Grayscale Bitcoin Trust have hit an all-time low against its net asset value (NAV) to trade at a 30.79% discount.
While a massive discount might seem like a bargain, in this case, it does not apply here. For instance, the GBTC has a six-month lockup period. This essentially means that the fund’s existing holders are running at a loss as the only way for them to cash in is to sell shares.
As of Friday, each share of GTBC holds $26.46 worth of bitcoin but GBTC itself trades at $18.35 at the time of writing.
Grayscale Working to Convert GBTC Into Bitcoin ETF
Grayscale suggests that the only way to cut off from the deep discount is by converting GBTC into a Bitcoin ETF, an exchange-traded fund backed by physical Bitcoin, which the digital asset manager had been long working on to get it approved.
Should the US Securities and Exchange Commission (SEC) approve Grayscale’s pending request, it would effectively reset the GBTC discount to zero. However, the regulatory agency has yet to greenlight a single spot Bitcoin ETF.
In the meantime, the digital asset manager met privately with the SEC last week in an effort to persuade the regulator to approve the conversion of its flagship fund into an ETF.