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Steve Miller

Co-Founder at MPower365
Is a CFA® Charterholder and co-founder of MPower365.com. A site devoted to helping people integrate cryptoassets into their investment portfolios. The CFA designation is globally recognized and attests to a charterholder’s success in a rigorous and comprehensive study program in the field of investment management and research analysis.

Visit the site to subscribe to the newsletter and stay up to date on his latest research into cryptoasset investing.

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
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GBTC Snapshot

STOCK: BITCOIN INVESTMENT TRUST (OTCQX:GBTC)

Exposure: Bitcoin

Features

  • Each share represents .00101 bitcoin (As of 2/15/2018)
  • Potential low price entry to BTC
  • Own BTC without the hassles
    • No need to purchase from an exchange
    • Eliminate storage and security concerns
  • Easily purchased for retirement accounts like IRAs through standard brokers (TD Ameritrade, Schwab, Vanguard, etc..) versus going the through the hassles of setting up a self directed IRA to directly custody Bitcoins.
  • Risk management vehicle for BTC holdings. Diversifying methods and locations of holdings is an important component of securing digital asset investments.

Reasons to be bullish

Blockchain, store of value, currency, decentralization, upside, and the list goes on.  People believe in this honey badger for many different reasons.  If you choose to invest, and are still researching your reason, start small.

Ensures receipt of forks when they occur versus holding btc on an exchange. Note if you are looking to hold forks long term then this is not the way to do it. Forks are liquidated when the opportunity presents itself and cash distributed to shareholders as a dividend.

Reasons to be bearish

The premium you pay for convenience is high, and there is an additional yearly 2% management fee.  At the time of this writing, GBTC is trading at $18.50 per share.  One bitcoin is listed at $10,093.02 on Coinbase (another common entry point for investors).

~991 GBTC shares = 1 bitcoin ———- $18.50 x 991 = $18,333.50

991 GBTC @ 18,333.50 / 1 BTC @ 10,093.02 = 81.6% premium!

Bottom Line

Given its insured GBTC is for investors looking to gain exposure to BTC without the process of purchasing and securing digital assets directly.  It can also be an effective vehicle for BTC exposure via traditional retirement accounts, as a hedge for direct BTC holdings, or for investors looking to speculate in BTC versus holding it.

For long term holdings direct BTC exposure should be considered. Given the expected premium you will pay to purchase GBTC currently and the potential for this premium to deteriorate over time. If additional public market vehicles offering exposure to BTC like ETFs begin to trade. Holding GBTC when these vehicles become available could lead to the perverse outcome of losing money while bitcoin continues to rise in value.

Legal Information and Disclosures

This review expresses the views of MPower365 as of (3/3/2018) and such views are subject to change without notice. MPower365 has no duty or obligation to update the information contained herein. Further, MPower365 makes no representation, and it should not be assumed, that past investment performance is an indication of future results. Moreover, wherever there is the potential for profit there is also the possibility of loss.

This review is being made available for educational purposes only and should not be used for any other purpose. The information contained herein does not constitute and should not be construed as an offering of advisory services or an offer to sell or solicitation to buy any securities or related financial instruments in any jurisdiction. Certain information contained herein concerning economic trends and performance is based on or derived from information provided by independent third-party sources.

MPower365 believes that the sources from which such information has been obtained are reliable; however, it cannot guarantee the accuracy of such information and has not independently verified the accuracy or completeness of such information or the assumptions on which such information is based.

This review, including the information contained herein, may not be copied, reproduced, republished, or posted in whole or in part, in any form without the prior written consent of MPower365

*Principals of MPower365 own shares (as of 3/3/2018) in the Bitcoin Investment Trust  (GBTC)

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Steve Miller

Co-Founder at MPower365
Is a CFA® Charterholder and co-founder of MPower365.com. A site devoted to helping people integrate cryptoassets into their investment portfolios. The CFA designation is globally recognized and attests to a charterholder’s success in a rigorous and comprehensive study program in the field of investment management and research analysis.

Visit the site to subscribe to the newsletter and stay up to date on his latest research into cryptoasset investing.

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

Follow me

Latest posts by Steve Miller (see all)

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