If you Google "Grayscale Sec.gov" you can read through their various hearings and some of the filings go into really specific detail about how they operate.
From what I gathered, it seemed as though they offered investors the ability to add bitcoin to their portfolios, but the phrasing gets a bit confusing whether or not you ever hold the actual coins, or if it is more along the lines of investing in gold.
There were also guidelines about when you were able to sell, because it had to be during a time window, which made it sound like a organized and planned massive buys and sells.
I initially was going to try and plug their data into a chart to see if their previous buys and sells significantly effects on Bitcoin's price, because they are on the whale status in terms of transactions, but that got put on hold because I realized I was trash at coding in python.
The minimum investment starts at around $50,000, and you need to be a registered accredited investor to qualify
I wasn't interested in investing in the trust directly. I am interested in buying shares offered over the counter. I've bought a few at Fidelity and can trade them there like regular stocks. The price varies based on investor sentiment, but is correlated to the underlying crypto price. The bitcoin one (GBTC) closed yesterday at $13.58. Each share represents slightly less than a thousandth of a bitcoin. With the price of bitcoin around $11,600 a share would be worth $11.10. So the premium in buying shares over actual bitcoins is around 22%. That's the downside.
On the upside, it's very easy to trade without getting into the whole bitcoin exchanges and wallets. If you assume bitcoin will generally move upward, you will overcome the premium in time. A big advantage for me is that I can hold them in a ROTH IRA tax free. Finally, when I do pass away, my family will find them in my brokerage account without having to get in the bitcoin realm. Just a thought.
In my previous post I mentioned the premium was at 22%. That was last August. The premium fluctuates and was over 30% earlier this year. It has been steadily dropping and has actually turned negative in the last few days. Does this making the shares of GBTC a bargain?
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