Bitcoin is still early

[jacoavlu]

NAV per share price at market close was $53.62. Closing share price around a 12% discount to NAV. It fluctuates between premium and discount. Anything wrong with buying at a discount?

gbtc historically traded at a premium until early 2021 when it flipped and has traded at a discount ever since. great to buy at a discount if the discount closes. but i think it just makes way more sense to buy spot outside of rare circumstances

[ShredtheGnar]

gbtc historically traded at a premium until early 2021 when it flipped and has traded at a discount ever since. great to buy at a discount if the discount closes. but i think it just makes way more sense to buy spot outside of rare circumstances

Yes, it might never close back. Won’t be so bad as long as BTC rises. If their ETF filing goes through, wonder how that will work out? Should be a much tighter range of discount/premium to NAV, I would think. 2022 should be an interesting year in the crypto realm.

[jacoavlu]

how it will work out, will it get converted to etf, should be no factor unless someone has a very compelling reason why they can’t simply buy spot

[ShredtheGnar]

how it will work out, will it get converted to etf, should be no factor unless someone has a very compelling reason why they can’t simply buy spot

It’s much easier in a IRA to buy the fund. Also no need for cold wallet. Buy ticker in your IRA brokerage without jumping through all the hoops to get it set up to buy crypto. Less worry about how to keep it safe and tax free growth. That’s good enough reason for me.

[jacoavlu]

It’s much easier in a IRA to buy the fund. Also no need for cold wallet. Buy ticker in your IRA brokerage without jumping through all the hoops to get it set up to buy crypto. Less worry about how to keep it safe and tax free growth. That’s good enough reason for me.

i get it’s easy. but depending on timing you may pay a significant price for that simplicity. if a different spot etf were to get approved gbtc could suffer further divergence. there are simple ways to buy spot also. best of luck

[xraygoggles]

if a different spot etf were to get approved gbtc could suffer further divergence.

Actually, if another company's bitcoin spot ETF were to be approved, the discount would close pretty quickly, anticipating a future conversion of the trust to a spot ETF.

[jacoavlu]

Actually, if another company's bitcoin spot ETF were to be approved, the discount would close pretty quickly, anticipating a future conversion of the trust to a spot ETF.

maybe. SEC seems difficult to predict.

[xraygoggles]

maybe. SEC seems difficult to predict.

It's inevitable I think.

[nycEMMD]

Actually, if another company's bitcoin spot ETF were to be approved, the discount would close pretty quickly, anticipating a future conversion of the trust to a spot ETF.

Agreed, any approval of a spot ETF and GBTC gets converted to spot ETF

[xraygoggles]

Getting back to volcano bonds, since that is the most interesting/bold/weird af thing going on in the btc world:

It's increased to 1 billion dollars now. I still think it's a poorly concocted scheme, not only because of the intermediaries involved, but the actual execution of the project.

What are the odds that an authoritarian leader (& his cronies) of an unstable country will abscond with a large proportion of the funds, whether through incompetence or malevolence? Fairly high.

What do the citizens of said country get from this? Zilch. The only people who benefit will be wealthy early Bitcoiners who move there to save taxes, then move away soon thereafter. Oh, also Blockstream, who gets the land if/when this project fails. Sounds like a sucker's bet for the native population if you ask me.

Remember Hanlon's razor: 'Never attribute to malice that which can be adequately explained by stupidity.'

[jacoavlu]

Getting back to volcano bonds, since that is the most interesting/bold/weird af thing going on in the btc world:

It's increased to 1 billion dollars now. I still think it's a poorly concocted scheme, not only because of the intermediaries involved, but the actual execution of the project.

What are the odds that an authoritarian leader (& his cronies) of an unstable country will abscond with a large proportion of the funds, whether through incompetence or malevolence? Fairly high.

What do the citizens of said country get from this? Zilch. The only people who benefit will be wealthy early Bitcoiners who move there to save taxes, then move away soon thereafter. Oh, also Blockstream, who gets the land if/when this project fails. Sounds like a sucker's bet for the native population if you ask me.

Remember Hanlon's razor: 'Never attribute to malice that which can be adequately explained by stupidity.'

i'll take the other side not bc i have strong feelings, but just bc i think it's interesting to debate

if i could reframe, i think you're saying its smart of bukele, and blockstream, but not smart for buyers?

[xraygoggles]

if i could reframe, i think you're saying its smart of bukele, and blockstream, but not smart for buyers?

.

[jacoavlu]

.

if I were to take the side of defending a buyer of the bonds

well, at baseline a candidate buyer has to be bitcoin bullish obviously. they're spending half proceeds on bitcoin to be held 5 years then periodically liquidated paying portion of proceeds to bond holders. in its brief history as im sure you know bitcoin has never not gained value in any 4 year holding period. so if someone wanted a bitcoin-adjacent investment, (arguably) less risk than buying spot, open to a broader range of investors vs spot (which some institutions charters wouldn't allow investment) I guess that's the argument I would have to make

I think it will be fully subscribed.

[jacoavlu]

anyone wants to see a cool visualization of the bitcoin mempool

https://bits.monospace.live/

[xraygoggles]

if I were to take the side of defending a buyer of the bonds

well, at baseline a candidate buyer has to be bitcoin bullish obviously. they're spending half proceeds on bitcoin to be held 5 years then periodically liquidated paying portion of proceeds to bond holders. in its brief history as im sure you know bitcoin has never not gained value in any 4 year holding period. so if someone wanted a bitcoin-adjacent investment, (arguably) less risk than buying spot, open to a broader range of investors vs spot (which some institutions charters wouldn't allow investment) I guess that's the argument I would have to make

I think it will be fully subscribed.

It may be fully subscribed, I'm not saying it won't. No one knows how it will fare.

In terms of institutions though, it's almost a certainty that most or all US-based institutional firms will not, because of regulatory hurdles both from SEC, but also from counterparty risk by the issuer and its intermediaries (Bitfinex/Tether).