Once upon a time, the Grayscale Bitcoin Trust (NYSEMKT: GBTC) traded at a consistent premium to its net asset value (NAV). From the fund's public market entrance in May 2015 to the end of 2020, the Grayscale fund averaged a 37% price premium over its holdings in pure Bitcoin (CRYPTO: BTC).

Early Bitcoin adopters appreciated the Grayscale fund's availability in ordinary stock-exchange accounts. The mutual fund structure also provided some peace of mind to investors unfamiliar with the newfangled cryptocurrency market.

But times have changed. The Grayscale fund's price premium started to fade in 2021 as Bitcoin prices soared in the third halving cycle and financial firms started thinking about the more effective exchange-traded fund (ETF) format for their cryptocurrency vehicles.

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Source Fool.com