Topic: GBTC Bitcoin Investment Trust Observer (Read 262369 times)

It's a dollar liability not a Bitcoin liability? Users paid in with dollars so I assume they're paid out in dollars. Grayscale may decide to pull it if they have an offer they can't refuse or decide the BTC can be retasked for more lucrative ends. No idea what the small print is but you're buying into an offshoot of property that remains theirs I presume.

What's the difference? They have ~365 million shares outstanding, which represents all the BTC in the trust.

If there's to be a coin backed ETF where would the new player get the coins from?

But almost all of that belongs to other people. I dunno what GBTC's terms are but I assume you only ever own shares they issue, not the BTC.

Demand (and the premium over NAV) will plummet whenever an ETF finally gets approved. GBTC's management fees are just insane and will be greatly undercut by an ETF.

GBTC is drawing on retail investors who want to invest through traditional and regulated brokers (like E-Trade) and/or with retirement accounts. They are sort of the only game in town for people who don't want to (or can't afford to) juggle CME futures positions. There will be other alternatives in the future that will cut GBTC down in size.

Just a few months ago, Coinbase held ~983,700 BTC in its cold storage. https://cryptoslate.com/nearly-1-million-bitcoins-worth-8-4-billion-now-held-in-coinbases-cold-storage-wallets/

Giving this a bump as a thread on Reddit pointed out that GBTC now has 351,000 BTC. The last time I paid any attention it was around the 90,000 mark which must've been a long time ago now.

I can't imagine any other entity ever managing to accrue an amount this large in future.

What do we reckon the endgame will be? Will they look to dominate Bitcoin investment and move the coins into different and less clunky wrappers as legislation evolves? Will they have an OTC monster sale? Will consumer demand for GBTC keep them where they are and continually growing?

Grayscale launched their ETH thingy, ETHE today. Has anyone noticed that the price their customers/victims are paying is in the region of $580 for 0.09 of ETH derived price exposure? I know it's not ETH itself but comes a time where a premium becomes a full on piss take.

Could that have some sort of knock on effect on the reputation of GBTC?

At one point it was suspended for a few months.
I think that SEC "hates" it.
Or, maybe BS has these feelings, lol.

Cool. Their fees were high in the past and maybe they used the LLC setup before.

Honestly, I still prefer XBT Provider's ETNs. The volume and market making on them is fantastic. Any USA broker that allows people to trade them in IRAs?

Cool. Their fees were high in the past and maybe they used the LLC setup before.

Honestly, I still prefer XBT Provider's ETNs. The volume and market making on them is fantastic. Any USA broker that allows people to trade them in IRAs?

Bitcoin IRA is not a self directed LLC setup.

Amun has crap volume though (unless I am looking at the wrong site). Many days they have 0 shares traded and they seem to have at most 5k shares (so like $100k-$200k n volume) on other days.

Bitcoin IRA uses a self-directed LLC setup right? Not too comfortable with those for the reasons I outlined above. I don't trust this setup as there are too many rules that I am sure the IRS will have a field day over once BTC is worth enough. An example from Broad Financial:

"Do not apply for overdraft protection or for a line of credit for your account...  by doing so, you will be issuing a personal guarantee on behalf of your solo 401(k) Plan/Trust which is a Prohibited Transaction."

Really stupid rules like that. Most banks automatically apply this, especially if you already have other accounts at the bank.

Amun has crap volume though (unless I am looking at the wrong site). Many days they have 0 shares traded and they seem to have at most 5k shares (so like $100k-$200k n volume) on other days.

Bitcoin IRA uses a self-directed LLC setup right? Not too comfortable with those for the reasons I outlined above. I don't trust this setup as there are too many rules that I am sure the IRS will have a field day over once BTC is worth enough. An example from Broad Financial:

"Do not apply for overdraft protection or for a line of credit for your account...  by doing so, you will be issuing a personal guarantee on behalf of your solo 401(k) Plan/Trust which is a Prohibited Transaction."

Really stupid rules like that. Most banks automatically apply this, especially if you already have other accounts at the bank.

Anum is legit. Also, have you looked at BitcoinIRA?

Fidelity is now blocking new purchases of XBT Provider's BTC and ETH exchange traded notes (ETNs). Tickers for these were COINXBT and COINETH I believe.

Fidelity is not currently forcing sells of these ETNs. This is in comparison to Interactive Brokers which forced sales of these ETNs by a certain date back in 2018, otherwise they would have dumped them on the open market.

Going to be honest, getting a little tired of how fucking hard it is to buy something in a US-based IRA that isn't GBTC with it's stupid premiums (which is near 30% at the moment). And Grayscale's Etherereum *CLASSIC* Trust (ETCG) trades at a laughable 233% premium now, probably due to uninformed people thinking they are actually buying ETH and not ETC.

Does anyone know of any broker open to US IRAs that allows trading in the XBT Provider ETNs ( https://xbtprovider.com/ )? I see that they added ETNs for Litecoin and Ripple now.

As an alternative, has anyone looked at Amun's Crypto ETPs ( https://www.amun.com/ )? I see they have a basket ETP (top 5 crypto assets), and separate ETPs for BTC, ETH, and XRP. Volume looked low though and I am not sure if they market make like XBT Provider does. Also not sure if any US brokers trade them.

I really don't want to go the route of those self-directed LLCs styled as IRAs (like Bitcoin IRA does). There are a myriad of little "gotchas" on these accounts that can cause the whole account to be disallowed.

Before crypto, these accounts were promoted for real estate investors, and there were just as many "gotchas" for them as well. I remember an instance where someone put rentals in a solo 401k. They personally painted one of the rentals without charging the solo 401k for it. I think during an audit this was enough to disallow the *entire* account and put them on the hook for taxes!

If BTC goes to where we all think it is going, I can guarantee there will be a concerted effort to see if any events happened in the past that will cause the tax deferred treatment to be disallowed.

This is a little out of date, but drives home why:

https://www.forbes.com/sites/janetnovack/2014/09/16/retirement-rich-list-gao-estimates-314-taxpayers-have-iras-averaging-258-million-each/#2bfbf39fb32c

You can see there were only 314 taxpayers in 2011 with more than $25mil in an IRA. A scant 25 BTC could be worth as much in the coming years.

An always hungry government will be looking at whatever ways it can to claw back that money. I know some earlier solo 401ks/IRAs for crypto promoted private key ownership, and I think just that will be enough to disallow a lot of the earlier accounts down the line if they are ever looked at.