Grayscale Bitcoin Trust’s (GBTC) share price continued to soar on Tuesday morning, reaching a price of $16 for the first time since May 10. This surge in price is due to optimism about the potential of converting the fund into an exchange-traded fund (ETF) after investment management firm BlackRock filed for a spot bitcoin (BTC) ETF. The discount on GBTC’s share price relative to net asset value narrowed to as low as 33%, the lowest level since last September.
Many are taking BlackRock’s conviction as a sign that they expect Grayscale to win its case against the SEC, and want to be in with an ETF filing should that happen, macro analyst Noelle Acheson said.
Vetle Lunde, analyst at digital asset research firm K33 Research, noted that GBTC’s liquidity remains low, and that the market is still implying that GBTC will remain close-ended until 2042 (when adjusting for annual fees). Thus one could very easily make the argument that GBTC still remains substantially underpriced due to backlash from all the built-up leverage from 2020-2021.
Rumors also emerged about Fidelity, another investment management giant, possibly filing for a spot BTC ETF or acquiring Grayscale. A Fidelity spokesperson told journalists that the firm had not publicly announced any plans to file.