GBTC delivered better returns than Bitcoin ETFs last week

Published at: Oct. 26, 2021

Bitcoin (BTC) investment vehicle the Grayscale Bitcoin Trust (GBTC) outperformed the newly-launched exchange-traded funds (ETFs) last week, data shows.

Figures shared by Grayscale executives among others confirm that GBTC quietly delivered better investor returns since Oct. 19.

Grayscale "discount" hits one-month lows

While talk continues to revolve around Bitcoin futures ETFs and their market impact, industry stalwart Grayscale is biting back.

Amid claims that the newly-launched funds are sucking custom away from GBTC, the firm's chiefs were quick to note that the latter was in fact a better bet since launch day.

Over the seven days to Monday, GBTC returned around 8.8%, while the pioneering Bitcoin futures ETF, ProShares' Bitcoin Strategy ETF (BITO), fell 0.5%.

This was thanks in part to the GBTC premium heading higher, reaching its lowest discount to spot price since early September this week.

Concerns previously centered on Grayscale's potential inability to rescue the negative premium as more ETFs launched, this in turn countered by those who argued that the two instruments' value proposition cannot be compared.

Barry Silbert, CEO of Grayscale parent company Digital Currency Group, further highlighted GBTC's higher trading volumes. For Monday, these totalled $374 million, while BITO managed $286 million.

As Cointelegraph reported, Grayscale CEO Michael Sonnenshein recently repeated his pledge to convert GBTC itself into an ETF, formally applying to do so with United States regulators.

Ethereum futures ETF next?

Meanwhile, Tuesday sees the launch of the third U.S. Bitcoin ETF, this time from VanEck.

Related: BTC price ‘on the way to $90K’ — 5 things to watch in Bitcoin this week

Long locked in a battle with the Securities and Exchange Commission (SEC) over bringing such a product to market, the release marks a line in the sand for longtime market participants.

The fate of physical Bitcoin ETFs — those with BTC actually delivered — still hangs in the balance ahead of an SEC decision on the first applications next month.

"If regulators cared enough about the best interest of investors, they would approve a physical Bitcoin ETF soon," VanEck director Gabor Gurbacs argued last week.

"14 countries in Europe, Canada, Brazil and other nations have access to physicals Bitcoin ETPs. Physical > Futures."

Popular trader and analyst Scott Melker countered that an Ethereum futures ETF will precede the physcial Bitcoin go-ahead.

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