While GBTC Bitcoin Stacking Slows, Grayscale Accumulates Alternative Crypto Assets

August 2, 2021 Bitcoin.com

Automated Investment Service Firm Wealthfront Adds Support for Grayscale’s BTC, ETH Trusts

July 31, 2021 Bitcoin.com

$25B investment firm adds ‘riskier’ Grayscale GBTC and ETHE for clients

July 30, 2021 Coin Telegraph

<div>B investment firm adds 'riskier' Grayscale GBTC and ETHE for clients</div>

Bitcoin

Wealthfront users will now be able to have up to 10% of their portfolios composed of the Grayscale Bitcoin and Ethereum Trusts.

Bitcoin (BTC) and Ether (ETH) exposure has come to one of the world's biggest automated investment firms.

In a blog post on July 29, Wealthfront, which has $25 billion in assets, confirmed that it had added two Grayscale funds to its suite of investment options.

GBTC buzz returns

The recent rise in cryptocurrency prices has kept institutional products such as Grayscale's various funds in the spotlight.

Wealthfront, an example of a so-called "robo advisor" in the investments space, will now allow its clients exposure to the Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE).

"Buying cryptocurrency can feel intimidating — it takes time and effort to research all of the options, set up a wallet, and monitor an additional account. That’s why we’ve made it easy to get exposure to Bitcoin and Ethereum right in your Wealthfront portfolio, no wallets required," the blog post explains.

"Instead of buying coins yourself, you can invest in GBTC and ETHE."

Clients will be able to have up to 10% of their portfolio in Grayscale products, a limit the firm attributes to the "riskier and more volatile" nature of crypto products.

The move nonetheless reduces the ease-of-access dilemma faced by those interested in Grayscale's funds, which are not always directly available, and place strict rules on shareowners.

Alongside Grayscale, meanwhile, Wealthfront increased its offering of exchange-traded funds (ETFs) from ARK Invest, itself a major GBTC stakeholder.

*ARK Invest's GBTC holdings (purple). Source: Cathiesark.com*

What unlocking?

The announcement comes as institutional interest in Bitcoin in particular shows no signs of decreasing at prices around $40,000.

As Cointelegraph reported, exchange balances have fallen sharply this week, as over-the-counter (OTC) desks also see significant activity.

For its part, Grayscale has rid itself of a negative narrative surrounding unlocking of GBTC shares after the events had no perceptible impact on BTC price action.

Remember when all the traditional analysts said the Grayscale unlock would unleash billions in selling this last week? Yeah, no.
— Willy Woo (@woonomic) July 29, 2021

Its CEO, Michael Sonnenshein, this week reiterated a pledge to turn all Grayscale crypto funds into ETFs at the earliest opportunity, subject to regulatory changes in the United States.

Wealthfront Adds Grayscale Bitcoin, Ethereum Shares

July 30, 2021 The Crypto Briefing

GBTC premium matches Bitcoin price crash levels as unlocking fear fades

July 27, 2021 Coin Telegraph

Bitcoin

Funds are flowing back into GBTC, data suggests, as CEO Sonnenshein reiterates plans to turn Grayscale crypto funds into ETFs.

The Grayscale Bitcoin Trust (GBTC) is echoing bullish sentiment in Bitcoin (BTC) as its premium over spot price rises to its highest since May.

Data from analytics resource Bybt shows that on Tuesday, the so-called Grayscale premium stood at -5.88%. The last time it was closer to zero was on May 25.

GBTC premium slips above -6%

That was a week after Bitcoin began a major price drawdown, which this week has finally shown signs of abating.

GBTC has been the subject of intense speculation since Bitcoin’s 55% price dip, with unlocking of GBTC shares allegedly capable of adding to selling pressure.

As Cointelegraph reported, such a premise is false by default, given restrictions in place on GBTC holders.

Nonetheless, interest in purchasing has resurfaced this month in particular, with conspicuous names adding to their tranche and increasing their Bitcoin exposure.

The Grayscale premium — the trading price of GBTC relative to the net asset value (NAV) of its BTC holdings — has increased in step, trending back to zero after an extended stay in negative territory.

With unlockings mostly complete, the narrative surrounding Bitcoin price suppression has all but disappeared.

“$GBTC premium has gone from -15% to -5% in 5 days,” trader and analyst Nick Hellmann commented on the latest changes.

“If $BTC can maintain these levels and have Grayscale premiums flip positive that will add fuel to this Bitcoin fire.”

Purpose Bitcoin ETF holdings hit pre-crash levels

Despite mixed perceptions over GBTC, one figure decidedly not at all bearish on any timeframe is Grayscale CEO Michael Sonnenshein.

In the company’s latest mid-year shareholder letter, Sonnenshein reiterated previous public statements about his intent to turn GBTC, along with its altcoin-focused equivalents, into exchange-traded funds (ETF).

“We are 100% committed to converting Grayscale Bitcoin Trust (symbol: GBTC), Grayscale Ethereum Trust (symbol: ETHE), and our other investment products into ETFs,” the letter reads.

With the United States yet to approve a single Bitcoin ETF, neighboring Canada, which gave the green light to the first player, the Purpose Bitcoin ETF, has never looked back.

On Tuesday, Purpose’s assets under management jumped from $900 million Canadian dollars to $1.1 billion CAD — its highest since May 13.

*Purpose Bitcoin ETF assets under management chart. Source: Bybt*

Institutions continue offloading BTC exposure despite price rebound

July 27, 2021 Coin Telegraph

Coin Telegraph

Bitcoin funds are still in decline as institutional sentiment remains bearish.

Investments in institutional Bitcoin products have continued to decline this past week.

In its July 26 Digital Asset Fund Flows report, CoinShares notes institutional crypto products have experienced outflows for the third consecutive week, with $28 million exiting the sector during the week ending July 23. As such, the week saw a 170% increase in outflows compared to the $10.4 million for the previous seven days.

The findings revealed that Bitcoin-based funds saw the largest outflows with $24 million, or 85% of combined outflows from crypto products. Monthly outflows for BTC are now at $49 million, although year-to-date flows remain positive at $4.1 billion. CoinShares stated:

“Last week’s outflows suggest negative sentiment still pervades the asset class despite more recent constructive comments from key industry players.”

Ether products also saw outflows of $7.3 million over the week, while multi-asset funds bucked the trend with a net inflow totaling $3.1 million. The report added that multi-asset funds are the only class of crypto investment products that have experienced net inflows for every week of 2021 so far.

Despite the downturn, leading crypto asset manager, Grayscale, recorded an inflow of $2.5 million for the period. Its latest assets under management bulletin reports total assets under management of $33.6 billion as of July 27.

CoinShares concluded that investment product turnover remains low at $1.7 billion for the week — comprising just 22% of May’s weekly average.

However, CoinShares’ data was recorded before Monday’s bullish market action that saw Bitcoin gain 15% in less than three hours.

Weekly roundup: Ark Invest, Edge Wealth Management, and Rothschild Investment accumulate crypto

July 23, 2021 Coin Telegraph

Asset Management

Cathie Wood's Ark Invest purchased more than 450,000 GBTC shares in two separate buys this week.

As the price of Bitcoin returned to more than $32,000 this week, some major firms announced they had increased their exposure to cryptocurrencies through Grayscale’s crypto trusts.

According to a Friday filing with the U.S. Securities and Exchange Commission, or SEC, New York-based investment firm Edge Wealth Management currently holds 54,134 shares of Grayscale’s Bitcoin Trust (GBTC), valued at $27.13 at the time of publication, and 25,280 shares of the company’s Ethereum Trust (ETHE). The crypto holdings are worth almost $2 million at $1,468,655 and $466,668, respectively, roughly 0.3% of the $703 million total assets under management the company reported on Feb. 2.

Grayscale’s crypto trusts are not new investment opportunities for Edge. The investment firm held 37,605 GBTC and 17,300 ETHE shares in April, representing increases of 44% and 46%, respectively.

Some institutions’ exposure to Bitcoin (BTC), Ether (ETH), and other cryptocurrencies through Grayscale have increased as digital currencies seemingly play a larger role in the global economy. Similar filings with the SEC show Rothschild Investment Corp quadrupled its exposure to Bitcoin through Grayscale, owning 38,346 GBTC shares in April and 141,405 GBTC as of June 30. With a reported more than $1 billion in assets under management as of April 8, the Bitcoin trust shares represent less than 0.09% of the investment firm’s holdings.

However, Cathie Wood's Ark Invest is continuing to purchase GBTC shares at higher rate than the two aforementioned companies. This week, the investment firm reported it purchased more than 450,000 shares of Grayscale Bitcoin Trust in two separate buys, bringing its combined holdings to more than 9 million shares, or roughly 0.5% of its portfolio. At its peak in March, GBTC represented 0.9% of Ark’s portfolio.

“The investment community continues to express interest in the digital currency asset class, and the crypto ecosystem more broadly, and as these assets gain mainstream adoption, we anticipate investors will seek new ways to access digital currencies to further diversify their portfolios,” said Grayscale CEO Michael Sonnenshein in a letter to investors.

The reports of GBTC purchases come the same week Grayscale unlocked 16,240 BTC worth of its Bitcoin Trust shares after six months. Though there was some speculation the price of the crypto asset could be adversely affected by such a large release in a single day, BTC saw a roughly 2.9% increase in price week-over-week and reached $32,457 at the time of publication.

Cathie Wood’s ARK Invest Adds 450,000 Shares of Grayscale’s Bitcoin Trust

July 22, 2021 The Daily Hodl

JPMorgan Lets Retail Wealth Clients Access Grayscale Products: Report

July 22, 2021 The Crypto Briefing

Rothschild Investment Corp has increased its Bitcoin exposure by 300% since April

July 20, 2021 Coin Telegraph

Ark Investment

Rothschild Investment Corp has bought more Bitcoin and Ethereum exposure via Grayscale despite the ongoing crypto market retreat.

Billion-dollar investment firm Rothschild Investment Corp quadrupled its exposure to Bitcoin (BTC) since April, new records show.

In a filing with the United States' Securities and Exchange Commission (SEC) on July 17, Rothschild confirmed that it now owns 141,405 shares of the Grayscale Bitcoin Trust (GBTC).

Rothschild GBTC shares near 150,000

A quiet but nonetheless substantial player among institutions, Rothchild Investment Corp has also invested in Grayscale's Ether (ETH) equivalent, the Grayscale Ethereum Trust.

Its exposure to Bitcoin has increased considerably this year, the filing shows — in April, its GBTC shares totaled 38,346.

In BTC terms, with each GBTC share equal to 0.000939767 BTC, Rothschild thus has an equivalent Bitcoin exposure of 132.8 BTC ($3.94 million).

The data implies that declining prices have not fazed executives, Bitcoin maintaining a drawdown for three months after hitting its all-time highs of $64,500 in mid May.

As Grayscale CEO Michael Sonnenshein noted this week, institutional players are likely taking little notice of short-term price moves, instead concentrating on a much lower-time-preference strategy when it comes to cryptocurrency.

"Investors in this asset class are really not focused on... short-term movements in price," he told CNBC.

"These are really investors looking at their allocations in the medium to long term, and so any volatility or dampening of volatility is not something anyone is fazed by."

On Monday, ARK Invest purchased a reported 310,000 GBTC shares of its own, bringing its combined holdings to 8.81 million or 0.5% of its portfolio. At its peak, GBTC represented 0.9% of the ARK portfolio in late March.

*ARK Invest GBTC holdings vs. GBTC price chart. Source: Cathie's Ark*

Good timing for Grayscale FUD?

As Cointelegraph reported, Grayscale is at the center of discussions this week as it unlocked over 16,000 BTC worth of GBTC shares on Sunday.

Concerns, while arguably unfounded, long abounded that the event would create downward Bitcoin price pressure, with the sharpening of the drawdown on Monday and Tuesday fuelling the fire.

*Grayscale GBTC flows. Source: Bybt.com*

Regardless, since GBTC investors cannot redeem shares for BTC and then sell for fiat currency, Bitcoin markets are in fact left out of the equation when it comes to unlockings.

Grayscale itself only sells a tiny amount of the Trust's BTC holdings for fund management purposes.

Grayscale