1 year ago
"It's nett bully quality for GBTC shareholders and FUD fighting," said Selkis.
According to a caller Twitter post by Ryan Selkis, CEO of blockchain probe steadfast Messari, Grayscale Bitcoin Trust's (GBTC) controlling shareholders Genesis Global and Digital Currency Group cannot simply "dump" their holdings to rise much capital. Selkis explained that the restrictions are owed to Rule 144A of the U.S. Securities Act of 1933, which forces issuers of over-the-counter, oregon OTC, traded entities to springiness beforehand announcement of projected sales, arsenic good arsenic a quarterly headdress connected merchantability of either 1% of outstanding shares oregon play traded volume.
2/ DCG bought astir $800mm worthy of GBTC shares since the premium flipped to a discount successful aboriginal 2021.
DCG's committee authorized up to $1.2bn of stock purchases crossed Grayscale Trusts.
In airy of the existent liquidity issues, the remainder is apt connected clasp indefinitely.
Based connected calculations provided by Selkis, this works to a maximum of $62 cardinal successful liquidations per 4th based connected the outstanding shares trial and $23 cardinal successful liquidations per 4th based connected the trading measurement test. "It's *much* much apt DCG-Genesis refinance utilizing GBTC arsenic collateral," helium wrote.
Grayscale Bitcoin Trust, the largest Bitcoin concern spot successful the world, is presently trading astatine a discount to nett plus worth (NAV) of 40% owed to liquidity issues surrounding its relation Genesis Global and rumors of insolvency surrounding its proprietor Digital Currency Group. It is said that Digital Currency Group bought astir $800 cardinal worthy of GBTC shares since it began trading astatine a discount to NAV. The steadfast and its affiliates present ain astir 10% of the trust's outstanding shares.
After Genesis Global began halting withdrawals connected Nov. 16, rumors began circulating that its genitor institution Digital Currency Group, was besides successful a authorities of insolvency and would request to liquidate GBTC to wage backmost its creditors. Grayscale has since clarified that "the laws, regulations, and documents that specify Grayscale's integer plus products prohibit the integer assets underlying the products from being lent, borrowed, oregon different encumbered" and that "the $BTC underlying Grayscale Bitcoin Trust are owned by $GBTC and $GBTC alone."
Grayscale besides published a missive signed by Coinbase's CFO, Alesia Haas, and CEO of Coinbase Custody, Aaron Schnarch, showing that it presently holds 635,235 Bitcoins (BTC) nether custody successful Grayscale's name.
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