Yes, I agree that owning spot bitcoin directly is the best option of all if you want to own crypto.
There are a great many investors out there who don’t want to go the route of opening up a crypto wallet at a place, such as Coinbase, to buy bitcoin.
Therefore, it can trade at a huge discount or premium to the underlying price to bitcoin, which can either enhance or detract from an investor’s total return.
That’s just not a smart way to invest and anyone who invested at that peak has seen little return on their investment despite bitcoin pushing $60,000.
Early in 2021, GBTC still traded at as much as a 20% premium.
The cost of rolling from one contract into the next typically comes with a cost and that will decay the value of BITO over time.
I don’t want to get too far into the weeds, but the share creation/redemption mechanism that exists for ETFs allows them to trade almost in lock step with their underlying portfolio.
The SEC has approved a bitcoin futures ETF, but it has also shown no inclination that it’s ready to approve a physical bitcoin ETF.
Does Grayscale really want to mess with such a cash cow? It might need to in order to compete since a spot bitcoin ETF would be far superior to a bitcoin trust in terms of structure.
There are a lot of variables still at play and betting on an ETF conversion that closes the discount is not a sure thing.