Qiao Wang – an investor, analyst and product manager at crypto market data company Messari – raised an important criticism of the way the Grayscale Bitcoin Trust, or GBTC, is set up.
In a June 11 tweet, Wang cites Grayscale’s official website, according to which „Grayscale Bitcoin Trust does not currently run a redemption program and may stop creations from time to time. He suggested that the absence of a rescue mechanism may result in GBTC trading being carried out at a discount compared to the net asset value, or NAV, of the fund.
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„You’re just donating your money to Grayscale.
Wang explained that when a publicly traded fund, or ETF, trades at a discount to the fund’s underlying assets, an arbitrator can buy the contract at an exchange and redeem it for the assets behind it. He said:
„Without the ability to redeem, you’re only giving your money to [Grayscale founder] Barry [Silbert].“
Grayscale buys over $92 million in Bitcoin in just one week and is approaching 300,000 units of the crypt currency
Grayscale is growing at a rapid rate
The latest news makes it clear that Grayscale’s reserves of cryptosystems are growing at an amazing rate. As Cointelegraph reported in late May, Grayscale was buying Bitcoin (BTC) 1.5 times faster than new units have been mined since the May 11 Bitcoin block reward halving.
SEC Official: A Bitcoin ETF could help put a fair price on the GBTC
In addition, Grayscale’s director of investor relations, Ray Sharif-Askary, recently announced that the company has also been aggressively buying Ether (ETH).