Partnered With:

Grayscale's 14 cryptocurrency trusts premium inventory, how to invest?

Read this article in 8 Minutes

Currently, out of the 14 cryptocurrency trusts under Grayscale, only 7 are trading at a discount.

Original title: "Reviewing the premium situation of 14 encrypted trusts of Grayscale, what investment opportunities exist?"

Original source: Odaily Star Daily

Last night, Grayscale won a lawsuit against the US Securities and Exchange Commission (SEC), with the court finding that the SEC's reasons for rejecting a Bitcoin spot ETF were insufficient. Although there is still a long way to go before final victory is achieved, Grayscale's brief victory undoubtedly boosted confidence in the market.

Stimulated by positive news, Grayscale's cryptocurrency trust has also gained favor from investors. According to finance.yahoo data, the trading volume of Grayscale Bitcoin Trust (GBTC) reached 20 million shares yesterday, the highest level since the cryptocurrency market crash in June 2022; the GBTC discount rate narrowed to 18.06%, the lowest level this year.

Fineqia research analyst Matteo Greco commented: "The significant narrowing of the Grayscale GBTC discount rate indicates a significantly increased likelihood of approval for ETF spot trading in the United States in the future, which encourages investors who believe that ETFs will be listed in the future to purchase GBTC at a significant discount."

Actually, many people may not have noticed that since the beginning of this year, the discount rate of several cryptocurrency trust funds under Grayscale has narrowed and the premium rate has expanded. This is not only due to the upward trend of the cryptocurrency market, but also the increase in buying volume brought by the increasing recognition of the traditional financial market. The significant reduction in the discount rate means that purchasing Grayscale trust products during the same period will yield much higher returns than purchasing cryptocurrency spot products.

According to statistics, currently only 7 out of the 14 encrypted trusts under Grayscale are at a discount - at the beginning of this year, 11 were at a discount, and in the past 8 months, 4 products have turned to positive premiums (XLM, MANA, ZEN, and BAT), while the discounts of the other seven products are also constantly narrowing. Odaily Star Daily has compiled the premium performance of Grayscale trusts this year, as shown in the video, click the link to view (better in landscape mode):

The data shows that in the middle and late December of last year, the discount of various currencies reached its maximum. For example, BTC reached -48.89% on December 14th last year, and ETH reached -59.61% on December 30th. After mid-June, with the application of Bitcoin spot ETF by many traditional institutions such as BlackRock, Grayscale products have been sought after, and the discounts of multiple products began to narrow and premiums began to expand. Especially last night, Grayscale won the lawsuit, and the discounts of BTC and ETH both hit new lows this year, which were 18.06% and -30.14% respectively.

Other grayscale products have varying performances, as follows:

ETC Trust (ETCG) was discounted by 76.69% at the beginning of this year, and hit a new low of -50.49% last night. Its performance throughout the year has been "stable", and its discount situation ranks last among Grayscale products.

BCH and LTC both belong to POW mining, and their performance this year has been stronger than BTC, which is also reflected in the premium of Grayscale products. Among them, the BCH Trust (BCHG) rose from -56.98% at the beginning of the year to -5.56% (July 4th) at one point; subsequently, BCH prices fell sharply, and BCHG discounts also fell to a low of -42.5% (August 4th); LTC Trust (LTCN) discounts rose from 65.23% at the beginning of the year to 19.03% (August 30th), which is comparable to the discount level of BCHG.

ZEC Trust (ZCSH) recorded two premiums on July 4th and August 3rd, respectively, at 4.65% and 16.02%.

XLM Trust (GXLM) reversed its decline at the end of January, turning from a discount to a premium, and then consolidated for more than four months at less than 10%. Finally, it exploded in June, with the premium rate continuously rising, reaching a high of 417.75% on July 1st, and currently maintaining at around 150% premium.

ZEN Trust (HZEN) has been trading at a premium since June, reaching a peak of 47.89% on July 21st.

BAT Trust (GBAT) has been trading at a discount of around 40% in the first half of the year. Starting from late June, it began to gain momentum and the premium rose to a maximum of 42.46% on July 1st.

LINK Trust (GLNK) remained stable throughout the year, maintaining a positive premium, reaching a maximum of 251.35% on July 4th.

MANA Trust (MANA) has been trading at a premium since March, with a peak of 158.58% (July 20th), and currently maintains a premium of over 50%.

FIL Trust (FILG) has maintained a premium of 109% since the beginning of the year, remaining stable and reaching a peak increase of 783.05% on July 14th.

LPT Trust (GLIV) appeared at a premium after May, with a maximum increase of 26.7% (July 6th), followed by a sharp decline, currently at a discount of 30%.

The Solana Trust (GSOL) is quite unique. It was offered to investors in November 2021, but it did not start supporting OTC over-the-counter trading until April 2023. According to data from the Grayscale official website, GSOL had a premium of 144.17% on its first day of trading on April 28th, and has maintained a premium of over 1x since then, reaching a high of 356.52% on August 15th. Currently, the premium is at 270%.

Finally, here is a GIF showing the premium trend of various currencies: