Grayscale Bitcoin Trust trading at discount of more than 40% amid market tumult

Quick Take

  • GBTC is trading at a discount of -40.7% today.
  • The latest low comes less than two months after its previous all-time low of -35.3%.
  • Crypto prices have capitulated over the past week as markets digest the downfall of Sam Bankman-Fried’s FTX and Alameda. 

The Grayscale Bitcoin Trust (GBTC), which has been trading at a discount since the beginning of 2021, hit a record low on Wednesday.

GBTC is currently trading at a discount of  -40.7%, its lowest point ever, according to The Block's data dashboard. The discount represents the market price of GBTC shares, which are more than 40% lower than its net asset value, or NAV.

GBTC hit a previous all-time low on Sept. 26, when it reached -35.3%. The discount narrowed in September as crypto prices traded down. 

In July, GBTC's discount hit a low of -34% ahead of the SEC's ruling on whether it could be converted to a spot bitcoin ETF. 

Crypto markets — and related equities — have been roiled this week by the public downfall of FTX. Sam Bankman-Fried's exchange came under increasing pressure last week when a report from CoinDesk showed Alameda, Bankman-Fried's trading shop, had $8 billion in liabilities — including $7.4 billion in loans.

On Sunday, Binance's CZ said his firm would sell its FTT holdings, the FTX exchange token. Alameda CEO Caroline Ellison stepped in on Twitter, offering to purchase the tokens from Binance for $22. Markets reacted negatively, and the price of FTT plummeted. Shortly after, CZ confirmed Binance made a significant transfer of FTT.

In the days since, FTX's inability to operate without fresh capital has come to light. Binance stepped in ostensibly to acquire the exchange, but following initial due diligence, backed away from the deal. 

Markets are wrought with uncertainty and prices continue to fall. Bitcoin was trading at $16,661 at the time of writing, according to TradingView. The leading cryptocurrency by market cap had been above $21,000 earlier on Sunday. It traded below $16,000 on Wednesday.


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