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Topic: Everything you wanted to know about Grayscale BTC Trust but were afraid to ask! - page 39. (Read 17106 times)

legendary
Activity: 3234
Merit: 5637
Blackjack.fun-Free Raffle-Join&Win $50🎲
Speaking of fees I checked out Coinbase Custody and it states the following :

Implementation fee
$0 – $10,000 depending on use-case Custody fee
50 bps annualized
Minimum balance $500,000

I have to admit I didn’t know what bps meant, so I had to seek help on Investopedia - Basis Points (BPS), and according to the table 50 bps would be 0.5%. If I calculate correctly, this would mean that Tesla will pay 0.5% to $1.5 billion - or $7.5 million per year + max $10 000 for implementation fee. Of course, assuming that they really use CC - and that I'm right with my calculation.

I agree that MS and Tesla are in a better position when it comes to the way they stored their BTC, but if they asked you or me what we think about it, the answer would be unique and very clear - "not your keys, not your coins."
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
If MicroStrategy and Tesla hold bitcoin directly, I can’t see any reason why an investment fund cannot do the same.

When you say it directly, I believe you don't think they keep their BTC in non-custodial wallets - because at least as far as MS is concerned they did all their purchases through Coinbase, and I believe Tesla did the same. If their BTC is in Coinbase Custody cold wallets, I believe that way of storing comes at a price - but it's probably less than what Grayscale charges.
Exactly, they probably hold bitcoin on Coinbase Custody. I know that they bought trough Coinbase, but I didn’t remember reading anything about their storage solution.

What I meant is that they own Bitcoins (even if they don’t own the private keys of their bitcoin they legally own those coins via a legally binding contract between them and Coinbase) and not some kind of “securitised bitcoin” like a GBTC share.
 
Edit:corrected funny typos.
legendary
Activity: 3234
Merit: 5637
Blackjack.fun-Free Raffle-Join&Win $50🎲
If MicroStrategy and Tesla hold bitcoin directly, I can’t see any reason why an investment fund cannot do the same.

When you say it directly, I believe you don't think they keep their BTC in non-custodial wallets - because at least as far as MS is concerned they did all their purchases through Coinbase, and I believe Tesla did the same. If their BTC is in Coinbase Custody cold wallets, I believe that way of storing comes at a price - but it's probably less than what Grayscale charges.
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
Wondering how traditional finance can use GBTC to boost their results?

ARK Invest Boosted Its GBTC Holdings by 2.14M Shares in Q4

Quote
Cathie Wood’s ARK Investment Management increased its holdings of the Grayscale Bitcoin Investment Trust (GBTC) by 2.14 million shares in the fourth quarter of 2020, bringing its holdings of the market-leading institutional bitcoin investment vehicle to 7.31 million shares.

Ark investment is now long almost 350 USD miso in GBTC.
I don’t know how ARK investors feel in paying 2%, or 7 millions, to Grayscale just to hold their coins. Looks like a bad deal to me.
If MicroStrategy and Tesla hold bitcoin directly, I can’t see any reason why an investment fund cannot do the same.

legendary
Activity: 3892
Merit: 11105
Self-Custody is a right. Say no to"Non-custodial"
Stop cheering
There is no proof grayscale is really invest anything.
They can Say or show their fake proofs.
I Don't belive it if I Don't see it with my own eyes.

And Where They get so much coins? If they are real?

We live in the World of lias...
Everything is fake Women's tits are fake I dont belive If I Don't see it.

In this world Can't belive anyone.

All of sudden Where this gravescale coming from?
The owners Back ground is unknown
The company just pop up from nowhere..

The website Looking shiet I done websites I make Ten times Better.

They Got so much money but website poor Looking?? 

How Come? 

Not really worth a response, but just contemplating such extremes of zero reserves would be almost impossible to achieve, but even something like less than 40% reserves would be quite difficult to juggle for 7-8 years.. even if escalating like Bernie Maddoff... and even less than 75% would be quite the ballsy move for any entity to attempt with an asset like bitcoin, but hey I doubt we could proclaim with 100% certainty that Grayscale has 100% of the reserves that they claim at all times.., but then risky to try to get away with fractional reserves, too.. the higher the fractional reserves, the more difficult to actually prevent getting caught.
member
Activity: 322
Merit: 14
Stop cheering
There is no proof grayscale is really invest anything.
They can Say or show their fake proofs.
I Don't belive it if I Don't see it with my own eyes.

And Where They get so much coins? If they are real?

We live in the World of lias...
Everything is fake Women's tits are fake I dont belive If I Don't see it.

In this world Can't belive anyone.

All of sudden Where this gravescale coming from?
The owners Back ground is unknown
The company just pop up from nowhere..

The website Looking shiet I done websites I make Ten times Better.

They Got so much money but website poor Looking?? 

How Come? 

legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
I was talking to one of the representatives from Grayscale and they were saying that they aim to be the first btc ETF on US exchanges. They also mentioned they would put some sort of way for gbtc holders to transfer over their shares into etf shares. Would make things very interesting if that was the case. I think the SEC would be much more willing to approve a grayscale ETF versus some of the other lesser known companies applying. I have a feeling that they know approval is still unlikely so they and a few of the other big players aren't applying yet. I wouldn't be surprised if they have inside insight from their talks with the SEC.

With the premium pretty much dead at this point I don't think many people will be trading in kind for shares. Hopefully with an etf they will open up physical delivery again so those of us who bought in through brokerages have the chance to pull out if we so desire.



Very interesting piece of information.
Still, I doubt that GreyScale would want to shit into an ETF, unless they see some kind of competition on that front.
They will be ready to act if and when there is a competition on the ETF camp, not moving as a leader, rather than as a follower.
newbie
Activity: 4
Merit: 3
I was talking to one of the representatives from Grayscale and they were saying that they aim to be the first btc ETF on US exchanges. They also mentioned they would put some sort of way for gbtc holders to transfer over their shares into etf shares. Would make things very interesting if that was the case. I think the SEC would be much more willing to approve a grayscale ETF versus some of the other lesser known companies applying. I have a feeling that they know approval is still unlikely so they and a few of the other big players aren't applying yet. I wouldn't be surprised if they have inside insight from their talks with the SEC.

With the premium pretty much dead at this point I don't think many people will be trading in kind for shares. Hopefully with an etf they will open up physical delivery again so those of us who bought in through brokerages have the chance to pull out if we so desire.

legendary
Activity: 1316
Merit: 1481
JayJuanGee that speaks Italian! now that is some news!
Going back on-track I agree with you both because if something like that highly unlikely scenario would happen that could resonate like a massive volcano explosion on the bitcoin market. I do hope they have put some protection for it otherwise the magnitude of the event can be enormous.
legendary
Activity: 3892
Merit: 11105
Self-Custody is a right. Say no to"Non-custodial"

What you are describing (or speculating upon) is almost like a BIG so fucking what. 


Funny thing here is this post didn’t resonate with me neither.

As I tried to figure out the best possible scenario for which GBTC is offloading their BTC on the market and nothing happens as they flow to a more efficient vehicle.

The only scenario where the price could be heavily impacted is, apart very hypothetical scenario of Bitcoin banning,  is a shift in the very favourable fiscal regime granted to GBTC interactions.

If GBTC get taxed Avery time they sell GBTC shares, something that is not currently happening as per my understanding, well the attractiveness of this vehicle would be greatly reduced.

This would force Grayscale to buy back shares and sell BTC, and cause mayhem on the markets.
Probability of this happening? Very low. If I were Barry Silver I would have been already using my 35 daily BTC to lobby g-men against this (and an ETF approval, of course).

Hey @JJG are we resonating again now? Aren’t we?

Andiamo a risuonare insieme.  (#no homo - ovviamente)

 Wink Wink
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23

What you are describing (or speculating upon) is almost like a BIG so fucking what. 


Funny thing here is this post didn’t resonate with me neither.

As I tried to figure out the best possible scenario for which GBTC is offloading their BTC on the market and nothing happens as they flow to a more efficient vehicle.

The only scenario where the price could be heavily impacted is, apart very hypothetical scenario of Bitcoin banning,  is a shift in the very favourable fiscal regime granted to GBTC interactions.

If GBTC get taxed Avery time they sell GBTC shares, something that is not currently happening as per my understanding, well the attractiveness of this vehicle would be greatly reduced.

This would force Grayscale to buy back shares and sell BTC, and cause mayhem on the markets.
Probability of this happening? Very low. If I were Barry Silver I would have been already using my 35 daily BTC to lobby g-men against this (and an ETF approval, of course).

Hey @JJG are we resonating again now? Aren’t we?
legendary
Activity: 3892
Merit: 11105
Self-Custody is a right. Say no to"Non-custodial"
Grayscale inflow hit the lowest level, Ruffer sold BTC worth as much as $750 million, and Elon Musk removed "Bitcoin" from Twitter bio - I wonder what is the reason that the price of BTC is suddenly rising towards $40k? Just one more in a series of bull traps maybe Roll Eyes

Ruffer sold part of their investment. They are still invested. Market was happy to absorb these buys, and this is a good news. Not everybody shares the "indefinite hodl" strategy à la Micheal Saylor.
This is a good news because sooner or later we will have to start pondering about the elephant in the room (taking back the discussion in topic).

The real question is: what happens with GBTC selling their BTC?

For now, we never experienced real OUTFLOWS from Grayscale.
If you want to exit from GBTC, Grayscale does not provide a repurchase agreement. So you have to sell your shares in the open market.
For the moment this happens at a hefty premium, so no big issue here.
But what happens when an ETF gets approved in the US?
Probably this ETF will sport a lower fee than grayscale. So investors will start selling their shares in GBTC to switch from GBTC to this new ETF.
Probably grayscale shares will have a discount on the NAV, and arbitrageur would kick in only at a discount sufficient to repay them for the higher commissions than the ETF.
Probably Grayscale would have to reduce the number of shares, selling their bitcoins.
This selling pressure would be countered by the buying pressure from the new ETF (assuming a perfect switch from the two entities the total effects should be negligible). Nevertheless, differences in timing between the two operations could induce greater volatility in the market.


I was about to send you a merit, fillippone, but the overall gist of your comment is not really resonating with me for some strange reason... #nohomo.   Tongue Tongue

What you are describing (or speculating upon) is almost like a BIG so fucking what. 

On an ongoing basis, we have money flowing from one asset into other assets based on arbitrage possibilities, but in the end, any new BTC financialization product such as an ETF, would likely cause greater interest (and demand) upon BTC supply rather than merely being some assessment of movement between one third party custodian and another. 

The devil is likely in the details, yet with no real information that ongoing demand for BTC is either going to shrink or remain flat even if there is movement between third party custodians.
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
Investors are still resorting to GBTC to gain exposure to Bitcoin.
according to The block:

Miller Opportunity Trust signals investment in Grayscale's Bitcoin Trust


Quote
Here's the full quote from Friday's filing by Miller Opportunity Trust (emphasis added):

Quote
"The Fund may seek investment exposure to bitcoin indirectly by investing in the Grayscale Bitcoin Trust, an entity that holds bitcoin. Grayscale Bitcoin Trust is a privately offered investment vehicle, the shares of which are also available over-the-counter. Bitcoin is a digital commodity that is not issued by a government, bank, or central organization. Bitcoin exists on an online, peer-to-peer computer network that hosts a public transaction ledger where bitcoin transfers are recorded (the “Blockchain”). Bitcoin has no physical existence beyond the record of transactions on the Blockchain. The Grayscale Bitcoin Trust invests principally in bitcoin. The Fund will not make any additional investments in the Grayscale Bitcoin Trust if, as a result of the investment, its aggregate investment in bitcoin exposure would be more than 15% of its assets at the time of investment."

This fund has more than 2 billion in AUM. Investing the 5% of this in bitcoin (allowing for a nice price target of 120K) would be 60 million investments. Something that could go unnoticed in the daily December inflows, but probably would raise a flag today.

For sure if I were a subscriber of this fund I certainly would ask Miller if there weren't more effective ways of getting exposure to BTC rather than pay 2% to Grayscale.
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
Grayscale inflow hit the lowest level, Ruffer sold BTC worth as much as $750 million, and Elon Musk removed "Bitcoin" from Twitter bio - I wonder what is the reason that the price of BTC is suddenly rising towards $40k? Just one more in a series of bull traps maybe Roll Eyes

Ruffer sold part of their investment. They are still invested. Market was happy to absorb these buys, and this is a good news. Not everybody shares the "indefinite hodl" strategy à la Micheal Saylor.
This is a good news because sooner or later we will have to start pondering about the elephant in the room (taking back the discussion in topic).

The real question is: what happens with GBTC selling their BTC?

For now, we never experienced real OUTFLOWS from Grayscale.
If you want to exit from GBTC, Grayscale does not provide a repurchase agreement. So you have to sell your shares in the open market.
For the moment this happens at a hefty premium, so no big issue here.
But what happens when an ETF gets approved in the US?
Probably this ETF will sport a lower fee than grayscale. So investors will start selling their shares in GBTC to switch from GBTC to this new ETF.
Probably grayscale shares will have a discount on the NAV, and arbitrageur would kick in only at a discount sufficient to repay them for the higher commissions than the ETF.
Probably Grayscale would have to reduce the number of shares, selling their bitcoins.
This selling pressure would be countered by the buying pressure from the new ETF (assuming a perfect switch from the two entities the total effects should be negligible). Nevertheless, differences in timing between the two operations could induce greater volatility in the market.
legendary
Activity: 3234
Merit: 5637
Blackjack.fun-Free Raffle-Join&Win $50🎲
Grayscale inflow hit the lowest level, Ruffer sold BTC worth as much as $750 million, and Elon Musk removed "Bitcoin" from Twitter bio - I wonder what is the reason that the price of BTC is suddenly rising towards $40k? Just one more in a series of bull traps maybe Roll Eyes
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
Yesterday Grayscale hit the lowest BTC inflow in the last 6 months: only 8 BTC, before the daily fees, that reduced the net daily inflow to actually -26 BTC

Jut me speculating, but as ETHER futures are approaching, maybe investors are trying to capitalise the bullish momentum they are witnessing.

Here the ETH inflows:



They have been outpacing bitcoin inflows.

legendary
Activity: 1624
Merit: 4417
Thank,s I think we covered this news here.
Anyway, thanks

Ah, you're absolutely right. It looks like I missed your post, sorry!

Indeed, sounds quite good, even if they slowed a little bit lately, let's see if it is a temporary bump in a smooth ride, or it is something more structural.

That's the one million dollar question. But in my opinion, even the smoothest ride has some bumps and therefore, we should not be unsettled at this point in time. I am very curious to see what the quarterly report for 1Q21 will look like. The best may still be ahead of us.  Cool
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
The Grayscale 4Q20 report is out.

Thank,s I think we covered this news here.
Anyway, thanks
Quote
"Fastest growing investment product in the world"

Indeed, sounds quite good, even if they slowed a little bit lately, let's see if it is a temporary bump in a smooth ride, or it is something more structural.
legendary
Activity: 1624
Merit: 4417
The Grayscale 4Q20 report is out. Pretty interesting read in my opinion: "Fastest growing investment product in the world", doesn't sound too bad.  Wink



Source: https://twitter.com/Grayscale/status/1356734399484735489



If you're interested in the key facts, please see below (for all information, please see the linked report on their website!)

Q4 2020 Investment Highlights

Total Investment into Grayscale Products: $3.3 billion
Average Weekly Investment – All Products: $250.7 million
Average Weekly Investment – Grayscale® Bitcoin Trust: $217.1 million
Average Weekly Investment – Grayscale® Ethereum Trust: $26.3 million
Average Weekly Investment – Grayscale® Digital Large Cap Fund: $1.6 million
Average Weekly Investment – Grayscale Products ex Bitcoin Trust3: $33.6 million

Majority of investment (93%) came from institutional investors, dominated by asset managers.

Year Ended 2020 (“YE20”) Highlights

Total Investment into Grayscale Products: $5.7 billion
Average Weekly Investment – All Products: $109.8 million
Average Weekly Investment – Grayscale Bitcoin Trust: $90.0 million
Average Weekly Investment – Grayscale Ethereum Trust: $15.2 million
Average Weekly Investment – Grayscale Digital Large Cap Fund: $1.4 million
Average Weekly Investment – Grayscale Products ex Bitcoin Trust5: $19.8 million

Majority of investment (86%) came from institutional investors, dominated by asset managers.



The Takeaway
2020 was a hallmark year for Grayscale and digital assets more broadly. Thank you to the community and our investors for making it possible. We are proud to share data that reflects the massive adoption throughout 2020, and specifically, 4Q20.

$3 Billion Dollar Quarter: Grayscale experienced unprecedented investor demand, with approximately $3.3 billion of inflows. Investment into the Grayscale family of products surpassed $5.7 billion during 2020, more than four times the $1.2 billion cumulative inflow into the products from 2013-2019.

Since inception, the Grayscale family of products has seen nearly $6.9 billion of inflows.  

$20 Billion Dollar AUM: Grayscale began the year with $2.0 billion in assets under management and ended 2020 with $20.2 billion. In 2020, Grayscale Bitcoin Trust was among the fastest growing investment products in the world, growing from $1.8 billion to $17.5 billion AUM.11 This is an incredible testament to the maturation of the digital currency ecosystem.

Grayscale Bitcoin Trust Inflows Outpace Mined Bitcoin: As we have noted in prior reports, the inflows into Grayscale Bitcoin Trust have continued to grow as a percent of mined Bitcoin. This metric is significant because miners are known to be the market’s natural sellers, often using their newly mined Bitcoin to pay for operating expenses. In 4Q20, Bitcoin inflows were approximately 194% of mined Bitcoin.

However, these comparisons are simply to illustrate supply and demand in the market. They do not provide insight into the destination of any newly mined Bitcoin during the measured periods.

Institutions are Here: Institutions have historically accounted for a majority of Grayscale inflows. This was especially true in 4Q20 as institutions accounted for 93% of capital inflows, or $3.0 billion. This may not come as a surprise given the recent flurry of news that institutions have warmed up to Bitcoin. Indeed, Grayscale Bitcoin Trust accounted for 87% of all inflows to our product family, the highest proportion since 2Q17, further evidence of institutions looking to Bitcoin as a reserve asset.

The average commitment among institutions is also growing at a significant pace. The average commitment from institutions was $6.8 million, up from an average of $2.9 million in 3Q20.

Surging Demand from RIAs: In 4Q20, Grayscale received substantial inbound interest from wealth managers interested to learn more about Bitcoin to satisfy the growing number of client requests. This is part of an emerging trend of the last six months that is critical for continued adoption.

Source/Full Report: https://grayscale.co/insights/grayscale-q4-2020-digital-asset-investment-report/
legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
One of the slowest days recently for GBTC with a minimal inflows of only 14 net BTC today.
I think we have to go back many weeks to observe three consecutive days below 1,000 BTC of net inflows.
Check the spreadsheet for all the details!


Wow so basically zero buying for the day haha. Clearly all the recent FUD and the ongoing correction has institutions staying on the sidelines and waiting to see what will happen. They were buying up hundreds of millions of dollars per day just a couple weeks ago haha.

Will be interesting to see if yesterday's pump lasts through the weekend or if it falls back to low $30,000s (as it seems to possibly be doing now). If it can hold some support from the pump though I think we'll see institutional buying pick back up next week. For now though it seems they've bought the dip as much as they wanted to and will be in wait-and-see mode until the market starts moving back up in a stable manner.

Yes, they are slowing down:



Well, this is not too bad, but compared to the last inflows this is certainly a disappointment.

IF we look at the quarterly projection, the situation doesn't look too bad:





The projected BTC amount is only slightly below the historical maximum, while the AUM reflect the spectacular growth in the underlying price.



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