So 3 arrows has ~6.25% of gbtc that is a shit ton. Couple things that could be going on here.
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1. They decided they wanted to be long btc with a chunk of their fund and decided to get the extra juice by buying at nav from the trust, or buy spot and contribute in kind, this means 3 arrows much bigger than people think, present company included
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2. They’ve borrowed a fuck ton of btc, maybe uncollateralized, and contributed it in kind to then roll gbtc for premium and collect that yield, possible but dicier effectively levering up
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Go shake down some large hodler and go listen bro you got all this btc give it to me I’ll pay you X% in interest, take btc give to trust in kind get shares, 6 months in sell shares buy btc spot collect premium rinse repeat till you die
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so fundamentally, greyscale is in need of BTC, and the premium is there because they can't print more to close the premium.
you split interest and keep the rest.
smart
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GBTC is in need of shares because demand on the otc markets is outpacing supply and sort of always has been, shares take 6 months to season though
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what is the reason for having a 6 month lockup at all? just creates an unnecessary friction and inefficient price for the trust no?
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I think it might be regulatory but I forget why
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