Bitcoin Investment Trust's Premium Has Exploded

Bitcoin Investment Trust's Premium Has Exploded

Speculators are paying high prices to bet on bitcoin. At the market close on Tuesday, Bitcoin Investment Trust (NASDAQOTH: GBTC) traded at a price 101.6% higher than the actual market value of the bitcoin it holds.

That's not a misprint. Shares ended Tuesday at $832.99, even though the value of the bitcoin backing the trust was valued at just $413.16 per share on bitcoin exchanges.

Over the 28 months or so of its existence as an over-the-counter stock, Bitcoin Investment Trust has closed at a premium to net asset value on 589 days. Only once has it traded for a discount: It happened back in 2015, when the closing price valued the trust at a microscopic 0.1% discount to the underlying value of its bitcoin.

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Source: Fool.com