Oct 16, 2023

Bloomberg Crypto: Markets Bet on Bitcoin ETF Approval as Grayscale GBTC Discount Falls to 16%

Bitcoin ETF Approval Boosts Grayscale GBTC Discount to 16%
Grayscale GBTC discount falls to 16% as markets bet on Bitcoin ETF approval

Grayscale Bitcoin Trust (GBTC) Trading at Lowest Discount in Two Years

As potential approval for Bitcoin exchange-traded funds (ETFs) in the United States is inching closer, Grayscale Bitcoin Trust (GBTC), the Bitcoin (BTC) investment vehicle of Grayscale, is trading at its lowest discount in nearly two years.

YCharts data reveals that the discount to Bitcoin’s net asset value (NAV) has narrowed to 15.87% as of Oct. 13.

Discount to NAV is a metric used to measure the gap between a security’s true value and its trading price. It can be seen that the discount began to shrink when BlackRock and other financial institutions filed applications for spot Bitcoin ETFs in mid-June, where the discount dropped from 44% on June 15 to 26.7% by July 5. Since then, the figure has kept on decreasing.

Bitcoin ETF Approval Imminent

CoinGecko data shows that the discount rate of GBTC has not been this low since early December 2021, only a month after Bitcoin’s all-time high of $69,000 on November 10.

Cryptocurrency investor Oliver Velez is confident that the market is pricing in a spot Bitcoin ETF approval by the end of the year.

Analyst Lyle Pratt believes that the GBTC discount rate will continue to “evaporate” over the next week or two as spot Bitcoin ETFs near approval.

On October 13, reports emerged that the United States Securities and Exchange Commission would not appeal the Grayscale decision, leading Bloomberg ETF analyst James Seyffart to refer to spot Bitcoin ETF approvals as a “done deal” in an October 13 post.

Grayscale Awaits SEC Approval for GBTC ETF Conversion

On October 15, Grayscale released a statement indicating that the SEC’s 45-day period to seek a rehearing had expired, which means the court will issue its “final mandate” within seven calendar days.

“The Grayscale team remains operationally ready to convert GBTC to an ETF upon the SEC’s approval, and we look forward to sharing more information as soon as possible,” the company stated.

Cointelegraph reached out to Grayscale for comment, but there was no immediate response.

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