A Popular Investment Trust Linked to the Price of Bitcoin
The Bitcoin Investment Trust is an investment trust that tracks the price of Bitcoin, and it officially began trading in 2013.It is not intended
for general investors but is offered by Grayscale to accredited investors. As the world’s first Bitcoin-linked investment trust, it was launched ahead of Bitcoin ETFs. Due to factors such as
intense competition in Bitcoin mining and the outlook for global cryptocurrencies, this investment trust experiences severe price volatility and has even plummeted by as much as 26% at one point.
Although the price of Bitcoin itself was rising at the time, the sharp drop in the Bitcoin Investment Trust is believed to have been caused by an excessive gap between the fund’s net asset value and its market price. It is thought that demand from institutional investors—who wanted to avoid the risks and hassle of directly holding Bitcoin—created a significant discrepancy between the fund’s market price and its actual net asset value, leading to the sharp decline as the market sought to realign these figures.
