ETFWorld : The opinion With the loom of shares in Grayscale Bitcoin Trust worth nearly 40,000 bitcoins set to unlock in July, the hotly-anticipated expirations have caused worry as many are concerned it will cause downward pressure on bitcoin’s price.
Bradley Duke, CEO of ETC Group
Bradley Duke, CEO of ETC Group, Europe’s leading provider of physically-backed cryptocurrency ETCs has responded by saying regarding the price of bitcoin, the expiration is unlikely to have any effect on those who use BTCE as it is structured differently to GBTC.
Bradley Duke, CEO of ETC Group said: “Considering the impact of this big 6-month lock-up expiration, there should be an understanding that GBTC investors may not wish to sell at a discount, and if they do can only sell the securities to other investors willing to buy into this product. There is no mechanism that allows investors to redeem GBTC for bitcoin.
BTCE is structured very differently to GBTC. It is always 100% backed by bitcoin and is fully fungible meaning that besides selling on the secondary market, investors can also take “physical” delivery of bitcoin in exchange for their BTCE. Because of this fungibility, BTCE tracks the price of bitcoin very faithfully without the large premiums and now discounts we associate with GBTC. BTCE also does not have any holding period and is approved by BaFin for retail and institutional investors.
Investors choosing BTCE are speculating only on the price of bitcoin and therefore don’t need to worry about the security trading at large premiums or discounts to the underlying.”