- Recent data shows that the Grayscale Bitcoin Trust discount has narrowed from a record high of around 50 percent during the collapse of the FTX exchange.
- Market optimism is at a record high with Bitcoin and Ethereum leading, driven primarily by institutional interest.
Market optimism seems to be at a record high as the year comes to a close. This is clearly demonstrated by the narrowing discount on the Grayscale Bitcoin Trust (GBTC) which has gone to levels not seen since 2021.
Data from YCharts shows the trust’s discount to its net asset value is 10.35 percent. Interestingly, the level reached by Grayscale Bitcoin Trust (GBTC) has not been seen since July 2021. This comes nearly a year after reaching a record 50 percent after a market plunge during the collapse of the FTX crypto exchange.
In recent days, Bitcoin (BTC) has set a new-year high of $37,000.The largest altcoin by market cap, Ethereum (ETH), has recently climbed above $2,000. The bullish wave has undoubtedly played a huge role in shrinking the discount of GBTC. The rally by cryptocurrencies has been driven primarily by the prospects of a Bitcoin spot ETF approval. The involvement by global financial leaders has fueled speculation of the approval of the first Bitcoin spot ETF in the coming months. This will offer institutional investors a safe and easy way to get involved in the crypto market without necessarily having to hold the digital assets directly.
Among the companies spearheading the new ETF product is Graysacale which is seeking to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitocin ETF. After initially rejecting this filing, the U.S. Securities and Exchange Commission (SEC) lost a court case against them in which Grayscale sought a rescind of the denial.
In recent days, the SEC has begun engaging Grayscale to transform its trust product, GBTC, into a traditional Bitcoin exchange-traded product (ETF). This dialogue has the potential to carry meaningful consequences for the cryptocurrency industry.
Grayscale could be the first or among the first companies that get a Bitcoin spot ETF, ushering in a new age of investment in the cryptocurrency market. Experts have shared their expectations on the approval of the product, with billions of dollars expected to flow into the market. According to multiple predictions, a Bitcoin spot ETF will be approved in the next couple of months.
It is clear that there is great interest in spot ETFs with BlackRock not only filing for a Bitcoin ETF but also an Ethereum spot ETF. This not only illustrates the confidence in the approval of a Bitcoin ETF but further suggests that the market will see the filing and approval of a majority of top cryptocurrencies.
