Grayscale Bitcoin Trust (GBTC) Predicted to Return to Premium Status
The Grayscale Bitcoin Trust (GBTC), an investment vehicle for Bitcoin, could see its BTC price "discount" disappear in 2024, according to monitoring resource CoinGlass. The so-called "GBTC premium" has been negative for over two-and-a-half years, but recent developments suggest a potential change in the near future. Grayscale's court victory over U.S. regulators and news that the U.S. Securities and Exchange Commission (SEC) must consider GBTC's conversion to a Bitcoin spot price exchange-traded fund (ETF) have caused the discount to reach its lowest levels since December 2021. This has led to speculation that the discount will close next year.
Size of GBTC's Assets Under Management Reflected in Bitcoin's Bull Run
Dylan LeClair, senior analyst at digital asset fund UTXO Management, highlighted the significant impact of GBTC's assets under management (AUM) on Bitcoin's recent surge to all-time highs. GBTC holds over 600,000 BTC and was the largest driver of the 2021 bull run in terms of flows. The recent decrease in the discount percentage is equivalent to 56,000 BTC returning to GBTC's AUM if shares are marked to market.
Potential Return of Key Moving Averages in Bitcoin Price Action
Market participants are keeping an eye on the implications of the Grayscale news for Bitcoin's price action. The potential return of key moving averages (MAs), specifically the 200-week and 200-day trend lines, is a significant factor to consider. These MAs failed to provide support during Bitcoin's decline to multi-month lows in August. Despite the previous daily candle closing above them, BTC/USD is struggling to hold at these levels. Traders are now looking for Bitcoin to reclaim the Bull Market moving averages as support to confirm a bullish trend.
Important Note
This article does not provide investment advice or recommendations. Investors should conduct their own research and consider the risks associated with every investment and trading move.
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