Grayscale's BTC Fund Records High Trading Amid ETF Approval Expectations

By: Eliza Bennet

Grayscale's Bitcoin Trust recorded a surge in trading on January 8, with a significant reduction in the fund's discount to 6.82%, its lowest since April 2021. The increased activity is attributed to market expectations regarding the potential approval of a Bitcoin exchange-traded fund (ETF). The trust saw an impressive trading activity surpassing 99% of the existing 3000 ETFs, with a recorded volume of $431.66 million.

Many firms including Grayscale, BlackRock, and Bitwise are awaiting the U.S. Securities and Exchanges Commission's (SEC) decision on their spot Bitcoin ETF applications. Expectations reached a peak after the SEC responded to several applicants about their registration details, sparking speculations about possible delays by the regulator. However, the regulator's interactions with applicants are seen as part of efforts to ensure ETF approval by January 10.

In sync with market anticipation, the GBTC (Grayscale Bitcoin Trust) discount, which represents the difference between its market price and its Bitcoin holdings per share, dropped to its lowest level in 18 months. On January 8, secondary sales of the shares closed at $39 while the holding per share stood at $41.