Grayscale Bitcoin Trust (GBTC) Jumps 12% Despite Ongoing Struggles

• The trust’s discount relative to the NAV of its Bitcoin assets shrank to 38.55 percent.
• According to treasury filings, it has 643,572 Bitcoin, worth around $11.1 billion.

On Monday, shares of the struggling Grayscale Bitcoin Trust (GBTC) jumped, bringing the trust’s discount to Bitcoin closer to BTC’s original price. The over-the-counter security saw a price increase of 11.56%, to $9.65, yesterday. As a result, the trust’s discount relative to the NAV of its Bitcoin assets shrank to 38.55 percent, the narrowest difference since the middle of November.

GBTC is a publicly traded security that allows investors to get exposure to Bitcoin without actually owning any of the cryptocurrency. The trust had previously traded at a premium to Bitcoin but has been trapped at a significant discount since late February 2022.

The price increase is occurring despite the fact that the investment business behind the trust and its parent company, Digital Currency Group (DCG), are dealing with a number of issues. When it comes to Bitcoin, Grayscale is the biggest holder in the world, after the cryptocurrency’s anonymous founder, Satoshi Nakamoto.

Striving For Spot Bitcoin ETF

According to treasury filings, it has 643,572 Bitcoin, worth around $11.1 billion at the current rate. Due to market uncertainty and the difficulty of shareholders to get their money back, the GBTC discount arose. According to Michael Sonnenshein, CEO of Grayscale, a spot Bitcoin exchange-traded fund (ETF) would provide stronger protection to investors than the trust’s current structure.

However, authorities in the United States have rejected the company’s application to form a Bitcoin ETF, as they have done with every other similar application. Grayscale Investments LLC sued the Securities and Exchange Commission in June 2022 after the SEC denied the company’s spot Bitcoin ETF application for a second time.