Grayscale officials have justified the high fees of the trust by emphasizing its heritage and administration. However, despite the constantly changing crypto market, GBTC has been unable to stop the outflow of funds.
Investors have long been pessimistic about the Grayscale Bitcoin Trust (GBTC). In fact, Bloomberg’s Senior ETF Analyst, Eric Balchunas, confirmed that this 72-day period is the longest in the history of global ETF funds. Since January, when spot Bitcoin ETFs were approved by the US government, the unexpected outflows have continued.
One possible reason for GBTC’s poor performance compared to its competitors could be the excessive fees it charges. Initially, Grayscale’s fees were 1.5 percent, which is significantly higher than the average 0.2 percent imposed by other ETF issuers. Grayscale officials defended these hefty fees by pointing to the trust’s heritage and administration. However, if the outflow continues, investors may not view the premium as justified. Industry experts are closely monitoring this trend, as they see Grayscale’s diminishing appeal as a warning sign.
The recent performance of BlackRock IBIT reflects the developments happening in the Bitcoin ETF industry as a whole. For the first time, this top Bitcoin ETF experienced a halt in new inflows. This may indicate that investors are losing interest in assets backed by Bitcoin due to the overall volatility of the market. The future of investing in ETFs like GBTC seems uncertain as Bitcoin prices display negative patterns.
In other crypto news, the TON Foundation has announced a $600K airdrop for NFT traders and holders. This development is worth noting in the current crypto landscape.
Overall, the inability of GBTC to stem the outflow of funds amidst the ever-changing crypto market raises concerns about its performance and future prospects.