April 1, 2023

In the ongoing drama between Grayscale and the SEC, the world’s largest Bitcoin fund, Grayscale Bitcoin Trust (GBTC), has been trading at a steep discount to the crypto-asset it holds for two years. However, in the days leading up to the much-anticipated fight, the GBTC discount to net asset value has slightly narrowed to 42%.

According to data from YCharts, the GBTC discount has been reduced from 47.35% on February 13th to 42.11%. This could potentially reflect the investor mindset of the lawsuit ending in Grayscale’s favor.

Grayscale filed to convert GBTC into an exchange-traded fund (ETF) with the SEC in October 2021. The regulator has approved multiple futures-backed crypto products but repeatedly dismissed spot ones. Grayscale decided to sue the SEC last summer, and the two parties are set to face off in court.

The outcome of the lawsuit could have significant implications for the crypto industry, as it could pave the way for more crypto-based ETFs to be approved by the SEC. Many investors are eagerly awaiting the outcome of the case, as it could potentially lead to a surge in demand for GBTC and other crypto-based investment products.

Despite the uncertainty surrounding the case, Grayscale remains optimistic about the future of crypto-based investment products. In a recent statement, the company said that it believes “the SEC will ultimately approve a Bitcoin ETF, and that GBTC will be the first to convert.” Only time will tell if Grayscale’s prediction comes true, but for now, investors are closely watching the GBTC discount and waiting for the outcome of the lawsuit.

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