Quote from: Lucius on Today at 01:23:55 PM

Quote from: el kaka22 on Today at 08:23:17 AM

Due to slow economy, we are lagging with triggering news and events to pump bitcoin prices but when hedge funds see bitcoin is doing stronger around $10k levels, definitely they start bet on it. It is going to be tough competition between gold and bitcoin until recession fever gets over. Let's wait and watch who is going to be crowned as better performing alternate asset of 2020.

Is Grayscale not good enough news? If they buy more Bitcoin per week than new one is mined, this should cause interest of other investors.

I believe there is more to the Grayscale story than meets the eye. During this period where there inflows are surging, the GBTC premium over spot is also sinking like a stone. In February, that premium was over 30%. Now it's 15%. In my opinion this is less of a story about bullish institutional accumulation and more of a story about institutional arbitrage.

It sucks to be a GBTC holder right now.

Quote from: exstasie on June 05, 2020, 08:16:12 PM

I took a closer look at the GBTC chart vs. BTCUSD and noticed the GBTC premium has been falling quite a bit recently. It's dropped in half since February alongside these big inflows.

I think there is increasing pressure to arbitrage the GBTC price. Even given the 1-year lockup period, a 30% premium (that's what it was at the Febuary peak) is just ridiculous not to arbitrage in a market with increasing regulated options at lower carry costs.

As one example, institutions could short GBTC while it's trading at a huge premium while buying shares at a discount (the NAV price) during private placements.

If this explains the increased volume, then we can probably expect the volume to die down (and maybe Grayscale's overall holdings to decrease as well) once the premium is no longer worth arbitraging.

https://cointelegraph.com/news/what-does-grayscales-gbtc-falling-premium-tell-us-about-bitcoin-price

I've been struggling to find an explanation since GBTC is so unattractive as an investment with its ridiculous premiums and 2% management fee. This is the best I can come up with.