Brave GBTC Investors Rewarded With 200% Annual Gain

After a bleak outlook a year ago, Grayscale’s bitcoin trust is now handsomely rewarding long-term investors.

Reviewed by: Ron Day
Edited by: Sean Allocca

Last winter was rough for the Grayscale Bitcoin Trust (GBTC). The price of bitcoin fell to nearly $15,000 in November 2022, a stunning 78% decline from its peak levels.  

Adding insult to injury, the Securities and Exchange Commission had rejected Grayscale’s attempt to convert its bitcoin trust into an exchange-traded fund just a few months prior. 

U.S. spot bitcoin ETF hopes had seldom been dimmer.  

With seemingly no chance for an ETF conversion, GBTC’s discount to its net asset value widened to as much as 48%, meaning the trust was valued at nearly half of what its underlying bitcoin holdings were worth.  

GBTC and Bitcoin Price

Yet, anyone courageous enough to buy GBTC at that gloomy time has now been rewarded. This week, the price of bitcoin briefly topped $35,000 for the first time in a year and a halfa rally ignited by ballooning expectations for a spot bitcoin ETF. 

GBTC’s discount to its net asset value fell as low as 11% a few days ago, its narrowest level in over two years. 

The combination of the bitcoin price spike and the drop in GBTC’s discount has led to a tripling, or a 200% increase, in the trust’s share price. 

If bitcoin stays here and GBTC’s discount completely disappears—the likely outcome of an ETF conversion—then gains for investors who bought the trust at last year’s depths could expand to nearly 300%.  

GBTC's Conversion to an ETF

Of course, a lot of those investors who scooped up GTBC at the 2022 lows have probably already cashed out. There’s little point in trying to squeeze out the last bit of juice from a trade that has already delivered eye-popping returns. 

That’s especially the case when a spot bitcoin ETF is still not a certainty. Sure, the probabilities have risen dramatically following Grayscale’s victory in its lawsuit against the SEC, but until the regulator officially gives the greenlight for the ETF conversion, there is a chance that there could be another twist in this saga that prevents it from happening.  

Sumit Roy is the senior ETF analyst for, where he's worked for 12 years. Before joining the company, Roy was the managing editor and commodities analyst for Hard Assets Investor. He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing pickleball and snowboarding.