Otcmkts gbtc bitcoin the premium is very high there are reasons that GBTC might be a logical investment for a set of investors. Why Are GBTC Bitcoins Naked?
As a result, I’ve been asked several times why anyone would invest in GBTC. And the premium right now? For every share of GBTC you get 0. The market value of 0. Obviously this will fluctuate over time as Bitcoin rises and falls but also because GBTC doesn’t perfectly track with the Bitcoin it holds.
In fact, that appears to be the insanity. Again, you are reading all of this correctly. You can buy Bitcoin directly if you want to own Bitcoin. There’s no requirement that you have to invest in GBTC in order to enjoy the surge in Bitcoin. Does It Ever Make Sense to Invest in GBTC? I will explain that now. Titled, auditable ownership through a traditional investment vehicle – The Bitcoin Investment Trust is a traditional investment vehicle with shares titled in the investors name, providing a familiar structure for financial and tax advisors and easy transferability to beneficiaries under estate laws.
Eligible for tax-advantaged accounts – Shares of the Bitcoin Investment Trust are eligible to be held in certain IRA, Roth IRA, and other brokerage and investor accounts. Publicly Quoted – Shares of the Bitcoin Investment Trust are eligible to be held in certain IRA, Roth IRA, and other brokerage and investor accounts. Wardwell LLP serves as legal counsel to the Sponsor of the Bitcoin Investment Trust. Financial statements for the Bitcoin Investment Trust are audited annually by Friedman LLP. Robust security and storage – The Bitcoin Investment Trust’s assets are stored with Xapo, Inc. Custodian, in deep cold storage vaults. Bitcoin stored in the Xapo Vaults reside on multisignature addresses, the private keys for which are protected by intense cryptographic, physical and process security.
Boiling all this down the main reason is that investing in GBTC is investing in something that feels familiar. That also means you can buy it easily through the normal channels and you can put it in the normal places. It takes away the fear, uncertainty and doubt of Bitcoin very rapidly. It seems less mysterious, less dirty.
You still get to play the Bitcoin “investing” game. I am not saying this is bad, or inappropriate, or silly. In fact, quite the opposite. If someone is trying to ride the Bitcoin trend, I can see how it could make sense to go with a low-resistance option. In this case, consider how much easier it would be to talk to your accountant about gains and losses of GBTC vs.
Although I have no interest in GBTC it wouldn’t be completely illogical or irrational for some people to invest for this reason. What About the “Insane Premium” Right Now? The GBTC premium is rich. That’s not a theoretical premium but instead a very real premium of GBTC over Bitcoin. Are there other reasons that make sense? And it’s all on the up-and-up, easily trackable for tax purposes, which I care about.