Grayscale Ethereum Trust nears record -60% discount

Quick Take

  • The Grayscale Ethereum Trust is trading at its highest discount yet of nearly -60%.
  • The Grayscale Bitcoin Trust has not fared better, hitting record discounts near -50% in December 2022.

The Grayscale Ethereum Trust (ETHE), a traditional investment vehicle providing institutional investors with passive exposure to the price of ether, is trading at its highest discount yet of almost -60%.

ETHE's discount to net asset value has been in a general decline since the end of 2020, but accelerated in Q4 of last year. Before Q2 2021, it consistently traded at a premium — hitting a high of nearly 950% in June 2020.

 

ETHE's decline can be attributed to multiple factors. "It's likely a combination of low faith in the fund being redeemable anytime soon, low faith in a spot ETF being approved anytime soon and low faith in the general crypto-market outlook," said Larry Cermak, The Block's VP of Research.

GBTC woes accelerated last month

The Grayscale Bitcoin Trust (GBTC) has not fared much better. It currently has a discount of 45%, having hit record discounts near -50% in Dec. 2022.

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