Quote from: bitbouillion on May 08, 2015, 10:19:06 PM

Quote from: OgNasty on May 08, 2015, 09:20:10 PM

Quote from: bitbouillion on May 08, 2015, 08:35:45 PM

Why would one buy a BTC for $490, when the price on US-regulated exchanges is $244?

The answer to this question is simple. The only advantage in buying this fund over buying BTC straight is the ability to purchase in your tax shielded accounts. Therefore, the logical explanation is that people are paying a premium to get exposure to tax free BTC gains. If you believe the price is headed to $10,000, you would much rather purchase at $500 without tax liabilities than to purchase at $250 with tax liabilities. That is the only logical explanation for the premium we are seeing.

Then we had to see these premiums on other funds too, like commodity or currency ETFs. E.g. I can put GLD easily into a tax shielded account, but not gold bullion. Nonetheless there is no premium on GLD.

You can buy physical gold in a tax shielded account.

Quote from: Biodom on May 08, 2015, 10:36:57 PM

This is a moot point anyway as you can buy more than 2 bitcoins for one "GBTC" bitcoin and come ahead even in a taxed account as long as your taxes are less than 50%.
In addition, most retirement accounts are tax-deferred, not untaxable (except Roth where you are taxed ufront).

Some people would prefer not to pay taxes if given the choice, but you are correct with this thinking and that is why the premium is most likely a reflection of the tax rate of it's buyers with a little boost for those who are ignorant and hit buy without researching. This is something I wasn't expecting, and if it holds true for COIN, things could get interesting, particularly for the ones who bought all the BTC for the fund. It's starting to make sense now why the Winks didn't bat an eyelash at selling $1,000 BTC. They're going to make an absolute killing on premiums and maintenance fees. It's actually scary how rich they would become if BTC is truly successful in the long term.