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So in my latest weekly (for anyone that wants to receive, dm an email), I talk about $GBTC, because what else would I talk about (I really do discuss other things crypto derivatives)
TLDR is that GBTC's role has flipped from being a source of BTC demand to being supply
TLDR is that GBTC's role has flipped from being a source of BTC demand to being supply
consider that for months, traders were grabbing BTC to lock up in GBTC to later sell to the market at a premium. Something like $13B in a few months.
It was like a sponge -- or for those who ride commodity style, it was like the Strategic Petroleum Reserve but for BTC.
It was like a sponge -- or for those who ride commodity style, it was like the Strategic Petroleum Reserve but for BTC.
No one is adding to the NAV trade now for the obvious reason that GBTC is at a discount. But the GBTC shares are coming to the market and act as additional supply. This is going to continue to drip into the market until all of the shares are unlocked.
As a not so side note, I think that this is one part of a two part story of why ETH is kicking BTC butt for now. (The second part is that everyone is socking away ETH for defi project lock-ups)
And these technicals / money flows or whatever you personally want to call it are impacting the forwards market.
CME forwards are crushed compared to a couple of months ago. Front month CME futures are pushing flat to negative and can't get up.
CME forwards are crushed compared to a couple of months ago. Front month CME futures are pushing flat to negative and can't get up.
$GBTC is going to be discount for a while because the supply is relentless. But hey, we know one thing for sure: in less than 6 months the supply is gone and won't ever come back.
By that time there will be an ETF (or it will be one)
NO ONE will be doing the NAV trade again
By that time there will be an ETF (or it will be one)
NO ONE will be doing the NAV trade again
There is going to be significant mark to market risk holding GBTC vs short futures but eventually the supply will clear. Either it will be an ETF or it will stay a closed end fund (ish) and trade -8% - +2%.
Probably a good time to say: DYOR, not investment advice, and I may be wrong.
