The Grayscale Bitcoin Trust (GBTC), the world’s largest Bitcoin (BTC) fund, bounced around 12% on Jan. This jump in the Bitcoin fund is considered a positive development as it reflects investor sentiment.
Amid major events such as the collapse of the Terra ecosystem in the cryptocurrency market last year, the collapse of crypto exchanges and companies such as FTX, the world’s largest Bitcoin fund GBTC is trading with a 70% decline on the annual chart and is currently priced below $10. The nearly 12% price increase on January 9 was GBTC’s biggest single-day jump since February 2022. The interesting thing is that Grayscale Bitcoin Trust has been outperforming Bitcoin in recent days. Last month, the fund’s discount to net asset value had dropped from 49% to 44%.
Yesterday’s rally was the last moment for Cameron Winklevoss, co-founder of cryptocurrency exchange Gemini, to “publicly commit to working together” with the Digital Currency Group (DCG) and Barry Silbert, and for subsidiary Genesis Global to hand over $900 million in frozen assets. It came after he marked January 8 as the date. It seems that the deadline set for the weekend passed without any fireworks, and Winklevoss did not specify what would happen if the deal did not materialize. Gemini’s co-founder’s open letter to Silbert has raised fears that Genesis Global may file for bankruptcy. It has also raised concerns over the health of parent company DCG, as well as the future of the Grayscale Bitcoin Trust.
Despite the current price rally in Grayscale Bitcoin Trust shares, it is still trading at a high discount of 44 percent relative to BTC, which is too high to ignore. Moreover, anger is growing about this issue and the fact that the structure of the fund does not allow for stock redemptions. In addition, cryptocurrency market veteran David Bailey launched a campaign called “Save GBTC” last month, which is gaining more and more attention. Bailey said in one of his recent tweets that around 20 percent of GBTC shareholders support this effort. However, he did not give much detail about it.