U.S. Bitcoin trust’s NAV hits lowest since bull run in 2017: crypto ETF to blame?
Grayscale bitcoin Investment trust [GBTC], the U.S Bitcoin investment trust has disappointed Bitcoin enthusiasts with a continuing downward trend since the big bull run of Bitcoin in Mid December. Shares of GBTC are down around 80 percent since BTC hit a high of $19,511 last year. The shares did not show a reversal in trends and stayed low throughout the year.
GBTC, the lone bitcoin investment firm in the U.S has hit the lowest point in its net asset value. This has been the case since the BTC price surge of late 2017 which saw the BTC prices hit $20000. The fund which was trading at more twice its net asset value during the price surge dropped down by 66%.
Experts attribute GBTC’s continuing downtrend to its expensive trading charges. The company charges $20 for every $1000 invested. That is 2% of the investment lost to trading fees. “Expense ratios are insane for these funds and the current Bitcoin price is creating more problems,” said Naeem Aslam, the London-based chief market analyst at TF Global Markets U.K. Ltd, according to a Bloomberg report.
Tyler Jenks made comments on Twitter regarding the GBTC share drop stating two factors that might have affected the GBTC share prices. Either the crypto community is hopeful about a Bitcoin ETF or the Bitcoin prices might fall further in the market.
GBTC premium down to below 10%. In the past, this would be a screaming buy. Not this time. Either BTC prices is about to go much lower, AND/OR, Big money is betting on a new Bitcoin ETF.
— Tyler Jenks (@LucidInvestment) October 1, 2018
Bitcoin investors are patiently waiting for a revival in prices and for the prices to go back to trading around $20000 again. The drop in GBTC share price might indicate that the Bitcoin investors are losing hope or the hefty trading fee charged by the trust that drives the investors away.
Image via Shutterstock
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