The GBTC premium is the same as Bitcoin’s crash level when the fear of unlocking subsides

The Grayscale Bitcoin Trust (GBTC) reflects the bullish sentiment in Bitcoin (BTC) as its premium over the spot price climbs to its highest level since May.

Data from analytics resource Bybt shows the so-ca grayscale premium was -5.88% on July 27th. The last time it was closer to zero was on May 25th.

GBTC premium slips over -6%

That was a week after Bitcoin started a big drop in price, which this week finally showed signs of weakening.

The GBTC premium is the same as Bitcoin’s crash level when the fear of unlocking subsides
The GBTC premium is the same as Bitcoin’s crash level when the fear of unlocking subsides

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

As Cointelegraph reported, because of the restrictions on GBTC holders, such a premise is by default wrong.

Nonetheless, buying interest has resurfaced, especially this month, as flashy names top up their tranche and increase their exposure to Bitcoin.

The grayscale premium – the trading price of GBTC in relation to the net asset value (NAV) of its BTC holdings – has risen in stages and tends to zero again after a prolonged stay in negative territory.

With the almost complete unlock, the narrative surrounding Bitcoin price suppression is all but gone.

“The GBTC premium rose from -15% to -5% in 5 days,” trader and analyst Nick Hellman commented about the last changes.

“If $ BTC can hold these levels and the grayscale premiums turn positive, it will fuel this bitcoin fire.”

GBTC premium chart. Source: Bybt

Purpose Bitcoin ETF stocks reached pre-crash levels

Despite mixed perceptions about GBTC, one figure that is clearly pessimistic in any time frame is Grayscale CEO Michael Sonnenshe

In the company’s most recent mid-year shareholder letter, Sonnenshein reiterated previous public statements of its intention to convert GBTC, along with its altcoin-focused equivalents, into exchange-traded funds (ETFs).

“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 said

With the US not yet having to approve a single Bitcoin ETF, neighboring Canada, which gave the green light to the first player, Purpose Bitcoin ETF, never looked back.

On Tuesday, Purpose’s assets under management jumped from $ 900 million to $ 1.1 billion, the highest since May 13.

Purpose Bitcoin ETF Assets under Management Chart. Source: Bybt