bitcoin_fonds

Bitcoin May Go Boom: A Guide to This Week's Big SEC Decision (Update)

[Update: The SEC rejected the ETF proposal on Friday afternoon, causing the price of bitcoin to slump.]

Bitcoin is at a critical juncture. Any time now, the Securities and Exchange Commission will issue a decision that could throw open the door to a flood of new capital, and change how many investors regard the digital currency.

The SEC’s bitcoin decision, which is over three years in the making, is due by Friday. Here’s a plain English guide to what might happen, including why the decision is so important and how it could affect the price of bitcoin.

What’s the SEC decision?

The agency must decide if the BATS stock exchange can change its rules to offer a bitcoin ETF (exchange traded fund), which would let people buy bitcoin like a common stock. The ETF—called the Winklevoss Bitcoin Trust ETF—is the creation of the Winklevoss brothers, who once fought Mark Zuckerberg for control of Facebook, and now own a large stock of bitcoins.

Why is this ETF such a big deal?

It’s all about liquidity. While there are plenty of places to buy bitcoin, many investment funds can only hold assets that meet certain regulatory standards—such as approval from the SEC. If the agency approves the ETF application, money managers who want to include bitcoin in their portfolio are likely to jump in. Meanwhile, millions of ordinary people will have an easy new way to buy the digital currency. I can’t really phrase it any better than this quote from BitMex, a bitcoin analysis site:

If the SEC approves the Bats rule change, all manner of American muppet retail investors can yolo into Bitcoin via a regulated ETF. The pool of eligible money that can easily obtain exposure to Bitcoin will dramatically rise. There are various predictions about the amount of money that could flow into Bitcoin. In short, it will be Yuge.

Where and when will we see the decision?

The SEC is obliged to make the decision by March 11, which is this Saturday. That means the ruling is almost certain to come out on Thursday or Friday.

According to Blake Estes, an alternative asset expert at the law firm Alston & Bird, the decision will appear on this SEC web page, and everyone will find out at the same time.

What are the odds the SEC says yes?

People are calling this a coin toss. Those who think the SEC will approve the ETF point to the skillful work carried out by the Winklevoss lawyers, and to the fact that bitcoin is far more mainstream than it was even two years ago. Today, many more people—including regulators—are familiar with digital currency and how it works. There is also a sense that a bitcoin ETF is sooner or later inevitable.

Pessimists, on the other hand, can point to two sets of concerns that could lead the SEC to give the thumbs down. The first of these relates to how the Winklevoss intend to run the operation. Some people are uneasy that the proposed ETF would use Winklevoss-controlled businesses to source and store the bitcoins that would back the shares. The other set of concerns lie with bitcoin itself. The digital currency has been subject to wild price fluctuations, driven in part by heists and insider antics. According to Estes, the SEC may worry the agency’s approval of an ETF could lead to a bubble inflated by bitcoin novices—a bubble that could then pop.

“Some fear it could be a good opportunity for legacy players to find the next sucker to take it off their hands,” said Estes.

How will this effect the price?

Bitcoin has been on another tear of late, nudging a record of $1,300 per unit—more than an ounce of gold. Some of this likely reflects investor optimism the SEC will approve the ETF, meaning a future price rise is partly baked-in. Nonetheless, there are broad expectations the short term price of bitcoin will go crazy if the SEC says yes.

If the SEC says no, it will have a negative effect, though probably not a very dramatic one. The reason is there are two other ETF application before the agency. One is called the Bitcoin Investment Trust, and was developed by Barry Silbert, a well known figure in the digital currency world. The other, called SolidX, is distinct in that proposes to insure its bitcoin assets.

As noted above, there is a general feeling that approval for a bitcoin ETF of one type or another is inevitable, and so a rebuff by the SEC to the Winkelvoss proposal would only be a temporary setback.

Should I buy bitcoin?

That’s something only you can decide—preferably after a lot of research. Today, many people see bitcoin as another alternative asset class to add to a diversified portfolio. But bitcoin has an extremely volatile history, and has been prone to spectacular crashes, so if you’re averse to risk, it’s probably not for you.

The Bitcoin Cash Fund

A community-driven, grassroots project to accelerate the adoption of Bitcoin Cash.

The Bitcoin Cash Fund is a non-profit organisation, with the mission of distributing donated funds to projects that promote Bitcoin Cash.

What Is Bitcoin Cash?

A person-to-person online global digital cash system.

A decentralized currency not controlled by any one person.

A secure, high-speed and low-cost payment system.

Our Mission

Our mission is to help Bitcoin Cash (BCH) serve one billion users within five years.

We believe that the key to success for Bitcoin Cash lies in making sure it is adopted as a global payment system. To achieve this we need to rapidly grow both business and user adoption in unison to develop a closed-loop economy that benefits everyone.

The Bitcoin Cash Fund supports community projects that help further these goals. We believe there is a tremendous amount of energy in the BCH community, and we aim to harness that energy and make BCH the currency of the future.

How Can I Help?

Submit a Proposal

Do you have a brilliant idea of how to promote adoption of Bitcoin Cash? Fill out our proposal form and we may help fund it!

We have active projects right now that need help from talented people like you. Volunteering is a great chance to earn some Bitcoin Cash while working with like-minded enthusiasts.

Want to help out but don't have time to get involved yourself? No problem! Your donations are what make this all possible.

These corporate sponsors are fully aligned with our goals and are pushing Bitcoin Cash adoption forward at a lightning pace.

2 Funds that Invest in Bitcoin (GBTC, ARKW)

When bitcoin burst on the scene in 2009, very few people could wrap their minds around the idea of money that exists purely in cyberspace. However, people who have grown wary of the central banks’ control over and manipulation of currencies latched on to it quickly, as did investors looking for ways to diversify their portfolios. As its popularity has grown, bitcoin, which has no central authority, has been used increasingly for international money transfers as well as for everyday commerce. More than 100,000 merchants now accept bitcoin for transactions.

Because it has a finite and known cap on its supply, the value of bitcoin increases as demand increases. Since March 20111, its value has increased by 41,693%, making it an attractive vehicle for investors. It is also very volatile, having lost more than 70% of its value since its peak price of $1,240 in December 2013. As of March 30, 2016, the price of bitcoin traded at $413 after bouncing up from the $200 level in January. The value of bitcoin is measured against the U.S. dollar.

Bitcoin’s volatility can be attributed to a number of factors, including the fact that it is not yet well understood as a store of value or a method of transfer. Investors can become very skittish about bitcoin when it makes the headlines over security vulnerabilities or its use in drug trafficking. In addition, investing directly in bitcoin can be a bit complex, requiring the ability to store and protect them. However, investors who are intrigued by bitcoin, either as speculative play or as a way to diversify a portfolio, now have an easier, less risky way to participate in the growing market of bitcoin.

As of March 2016, there is only one publicly traded exchange-traded fund investing in bitcoin, the Bitcoin Investment Trust (OTC: GBTC). However, investors can invest indirectly in bitcoin through two funds offered by ARK Investment Management, which has added the Bitcoin Investment Trust to its portfolio.

The Bitcoin Investment Trust

The Bitcoin Investment Trust was established as an open-ended private trust by Alternative Currency Asset Management and is now sponsored by Grayscale Investments LLC. It was launched as a publicly traded ETF in 2015. The fund’s objective is to track the underlying value of bitcoin much like the SPDR Shares ETF (NYSEARCA: GLD) tracks the underlying value of gold. As of March 30, 2016, the fund had $80.5 million in assets under management (AUM), and it is thinly traded with just 6,529 shares in average daily trading volume. The fund’s assets are stored with Xapo, Inc. and they are protected with extreme cryptographic security. As of April. the fund is down 11.11% year to date YTD. The fund has a very high expense ratio of 2%, partly to cover the extra cost of safekeeping.

The Bitcoin Investment Trust is open only to accredited investors who have earned income over $200,000 ($300,000 jointly) or have a net worth over $1 million. The minimum investment is $25,000.

6 New Hedge Funds Seeking Bitcoin Returns

It's been a bumper year for bitcoin hedge funds. While the entry of big money from Wall Street into the bitcoin markets is discussed with equal measures of glee and rage in the community, some big-money financiers are already making moves in the cryptocurrency markets.

We're not talking about Barry Silbert's Bitcoin Investment Trust or the Winklevoss twins ' bitcoin index fund. No, there's a new class of funds running money for wealthy individuals, families and institutions, aimed to get these sophisticated investors into the bitcoin game.

Here's a roundup of the new bitcoin funds so far:

Global Advisors Bitcoin Investment Fund

The Global Advisors Bitcoin Investment Fund, which goes by the catchy acronym GABI, has claimed the title of the world's first regulated bitcoin hedge fund. That said, it's regulated in Jersey, the British Crown dependancy that is one of the world's top tax havens. The fund is due to launch on 1st August, according to Newsweek, and will seek clients in the UK, Europe and the Middle East.

The GABI Fund is run by Daniel Masters, a former energy trader at Shell and JP Morgan, where he rose to run its global energy trading division in the late nineties. In 1999, Masters also co-founded Global Advisors, a Jersey-based commodities hedge fund.

The new fund hasn't made public its planned fund size, or its likely trading approach, but Newsweek's Leah McGrath Goodman reports that Masters is bullish on bitcoin's long-term future and is attracted to the money-making opportunities in its current price volatility.

So what does regulation mean for GABI? According to the Jersey Financial Services Commission, "certified funds" like GABI must adhere to a code of practice established by the regulator that are designed to protect clients. This includes demonstrating the existence of financial resources and adequate insurance, setting up risk-management systems and being subject to future guidance from the commission .

Future guidance for bitcoin funds will be forthcoming, as the commission's Financial Crime Strategy Group is due to make recommendations on the risks linked to cryptocurrencies by the end of the year.

Pantera Capital

Pantera Capital brings some serious Wall Street pedigree to the table. The fund, which buys bitcoin as an asset, but also acts as a venture capital backer to bitcoin startups, is packed with a roster of high-profile names from high finance. Its principal is Dan Morehead, a former chief financial officer and head of macro trading at the legendary hedge fund Tiger Management.

Pantera's fund size is about $150m, which is three times larger than SecondMarket's Bitcoin Investment Trust, according to regulatory filings. It's fuelled by money from large institutional investors like Fortress Investment Group and venture capital firms Benchmark Capital and Ribbit Capital. Pantera also counts Mt. Gox and Ripple creator Jed McCaleb among its executives.

The firm put its sizable bankroll to use in search of early-stage company deal flow – even flying bitcoin startups to Lake Tahoe in private jets to be wined and dined, according to Bloomberg News. Pantera emerged as a backer of current top exchange (in terms of US dollar trading) Bitstamp, having put in $10m.

It's unclear how well Pantera has done with its bitcoin holdings so far. However, we do know that Fortress lost some $3.7m on a $20m bitcoin investment in 2013, according to The Wall Street Journal, before throwing its cryptocurrency lot in with Pantera.

Bitcoins Reserve

One group of traders hoping to cash in on the persistent price differences among various bitcoin exchanges is Bitcoins Reserve. Calling itself a "cryptocurrency arbitrage fund", Bitcoins Reserve hopes to buy low on one exchange and sell high on another, using automated trading software that it has developed itself.

The fund, a subsidiary of a British Virgin Island-incorporated firm called Chesham Group Ltd, says in its prospectus that it has returned 765% in the 12 months ending April 2014, beating bitcoin's price movement by more than 200 points.

Bitcoins Reserve is a relative minnow compared to other companies in this article; saying it wants to have just $5m under management by year's end. The firm hasn't publicly disclosed its current fund size. It's worth noting that Bitcoins Reserve was the victim of a phishing attack earlier this month, losing 100 BTC to the scam.

Binary Financial

This San Francisco-based fund began to build a public profile when it was named as an investor in ASIC manufacturer BitFury's hefty $20m round at the end of May. The firm is stocked with technology startup pedigree, with Jonathan Teo, who led investments in Twitter and Instagram, as a partner at Benchmark Capital, holding the post of chairman.

Binary also trades on its own account and for clients, however, deploying a range of trading strategies, including arbitrage, according to managing partner Harry Yeh, who's based in Vancouver. Yeh wouldn't say how much he has under management, although he said the fund's clients tended to be accredited investors.

Coin Capital Partners

Another hedge fund that's making big investor promises is New York-based Coin Capital Partners. The fund launched in May, promising "hedge fund industry best practices" and "investment grade" exposure to bitcoin.

Coin Capital intends to court accredited investors under the scrutiny of the Securities and Exchange Commission, and says it employs a straightforward buy-and hold-strategy for investors with a "long-term bullish stance" on the bitcoin price.

The firm is run by Samuel Cahn, a lawyer and investment manager who previously managed an arbitrage fund, who told trade title FINAlternatives that his fund has been seeded from a family office. His partners in the fund are brothers Sigmund and Drew Sommer.

Coin Capital has not disclosed its fund size.

Falcon Global Capital

Falcon Global Capital is bringing both financial firepower and its powers of professional persuasion to bear for its clients. The firm, which isn't a wheeling and dealing hedge fund, but rather an asset management vehicle for investors to buy and hold bitcoins, has also launched a lobbying initiative on Capitol Hill to raise awareness of bitcoin among legislators. Falcon's co-founder is Brett Stapper, himself a federally registered lobbyist.

Falcon, like the other funds listed here, targets accredited investors looking to buy relatively big chunks of bitcoin, but who don't want the hassle of procuring the coins themselves, or the risk of losing them through a security oversight.

The company buys bitcoin for its clients, with the smallest order being $25,000, and uses London startup Elliptic for its insured storage services.

Disclaimer: This article should not be viewed as an endorsement of any of the companies mentioned. Please do your own extensive research before considering investing any funds in these products.

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Bitcoin ETF

Featured Story

When Is the Winklevoss Bitcoin ETF IPO?

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - March 1, 2017

The Winklevoss Bitcoin ETF IPO launch date has not yet been set.

When it occurs depends on whether the SEC approves a rule change that will allow the Winklevoss Bitcoin Trust (the ETF's official name) to begin trading.

What happens with the Winklevoss ETF will determine the fate of two others also awaiting SEC approval.

Article Index

When Is the Winklevoss Bitcoin ETF IPO?

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - March 1, 2017

Start the conversation

The Winklevoss Bitcoin ETF IPO launch date has not yet been set.

When it occurs depends on whether the SEC approves a rule change that will allow the Winklevoss Bitcoin Trust (the ETF's official name) to begin trading.

What happens with the Winklevoss ETF will determine the fate of two others also awaiting SEC approval.

What Is the Winklevoss Bitcoin ETF?

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - February 28, 2017

Start the conversation

The Winklevoss Bitcoin ETF is an exchange-traded fund that will make it much easier to invest in the Bitcoin digital currency.

The Winklevoss Bitcoin Trust still requires SEC approval of a rule change. A decision is expected by March 11.

But if the SEC does approve this Bitcoin ETF, the price of Bitcoin could double in a very short time.

The First Bitcoin ETF Could Win Approval in March Despite Long Odds

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - February 2, 2017

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The SEC has plenty of reasons not to approve the first Bitcoin ETF by next month's deadline. But there's a good chance the agency will surprise everyone and make the first Bitcoin ETF a reality.

Most analysts believe the SEC will turn down the three active bids to become the first Bitcoin ETF, which includes the Winklevoss Bitcoin Trust.

Winklevoss Bitcoin ETF Update This Week Could Help SEC Approval

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - October 21, 2016

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As the Winklevoss Bitcoin ETF enters the home stretch in its bid for SEC approval, its latest filing shows it's doing all it can to convince the agency that its ETF will be a safe investing vehicle.

The latest amendment to the Winklevoss Bitcoin Trust's S-1 filing reveals that it has enlisted two respected partners, financial services company State Street Corp. and accounting firm Burr Pilger Mayer.

Why the First Bitcoin ETF Could Double the Price of Bitcoin

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - September 9, 2016

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When the first Bitcoin ETF lands - an event that could happen any day now - it will have a dramatic impact on the price of Bitcoin.

The arrival of the first Bitcoin ETF will be a powerful Bitcoin price catalyst because it will mimic other commodity-based ETFs, particularly those based on gold and silver.

Those ETFs were primary factors in the steep rise in gold and silver prices a decade ago.

Bitcoin ETFs Can Work – but This Ethereum ETF Won't

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - July 20, 2016

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Seeing two Bitcoin ETFs seeking regulatory approval, an upstart group has now filed for something even more radical - an Ethereum ETF.

The evidence suggests the group, the EtherIndex Ether Trust, threw together its S-1 filing with the SEC willy-nilly in an effort to be first in line to file for an Ethereum ETF.

But the problems with this ETF proposal run much deeper than that.

Why the SolidX Bitcoin ETF Is a Step Behind the Winklevoss Bitcoin ETF

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - July 13, 2016

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One Bitcoin ETF is good, but two are better. And now that the SolidX Bitcoin ETF has filed an S-1 with the Securities and Exchange Commission, we could have two Bitcoin ETFs trading on major U.S. exchanges by next year.

The only question now is which one will gain the bragging rights of making it first to the finish line.

How One Simple Hedge Could Actually Give the Biggest Profits of the 21st Century

By Michael A. Robinson , Defense + Tech Specialist , Money Morning • @Robinson_STI - February 9, 2016

Start the conversation

Millions of investors dedicate a portion of their portfolio to gold or some other precious metal as a hedge - as "insurance" - against trouble in other markets.

At its base, this is a sound strategy, because precious metals generally aren't affected by the ups and downs of the stock market.

This isn't a "gold service," however. Our interest is in tech investing. So let's spend today investigating what I think of as "the gold of tech."

Not only can you use this investment as a hedge, but financial players are beginning to eye the technology behind it as way to disrupt the $500 billion payments industry.

Bitcoin News: Now That the CFTC Says It's a Commodity, What's Next?

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - September 18, 2015

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In a major piece of Bitcoin news, the Commodity Futures Trading Commission (CFTC) ruled that the digital currency is a commodity.

It's a significant step along the road toward Bitcoin regulation. While some early adopters of Bitcoin would prefer no government involvement with Bitcoin, Bitcoin regulation is necessary for the digital currency to play any meaningful role in the financial system.

Looking for a Bitcoin Stock Symbol? We've Got Them All

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - June 12, 2015

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Looking for the Bitcoin stock symbol is not as straightforward as you might think.

Technically speaking, there's no such thing as a "Bitcoin stock symbol," although there are several tickers associated with Bitcoin.

Price of Bitcoin Creeps Up on Wave of Major Developments

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - May 4, 2015

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A rapid-fire string of good news over the past week has help nudge up the price of Bitcoin.

A week ago the Bitcoin price was hovering around $225, somewhat disappointing since just six weeks earlier it was threating to break through the $300 level.

But then we started to get some major positive Bitcoin news. Over the past few days, the Bitcoin price is up about 7%, trading in the neighborhood of $240

The First Bitcoin ETF Offers Easy Way to Profit from Virtual Currency (GBTC)

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - March 3, 2015

Start the conversation

The first Bitcoin ETF ordinary investors can buy will be the Bitcoin Investment Trust.

With approval last week from the Financial Industry Regulatory Authority (FINRA) to sell its shares on the OTC Markets, shares should start trading within the next couple of weeks.

The fund gives investors a way to invest in Bitcoin without going to the trouble of buying Bitcoin and worrying about having a secure place to store it.

This Bitcoin Price Chart Shows What's Blocking Faster Adoption

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - February 3, 2015

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The Bitcoin price chart for January shows volatility is just as much of an issue for the digital currency as ever.

But for Bitcoin to gain mainstream adoption, this problem must be solved. A currency that can Bitcoin's tendency to lose 20% to 40% of its value in a matter of days, or even hours, discourages its use for daily transactions.

Winklevoss Bitcoin ETF Files to Sell 1 Million Shares (Nasdaq: COIN)

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - January 2, 2015

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Taking one step closer to going live, the Winklevoss Bitcoin ETF filed an amendment Dec. 30 to its Securities and Exchange Commission (SEC) prospectus to list 1 million shares at an offer price of $20.09 per share.

If approved, the aggregate value of the shares will be $20.09 million.

Officially known as the Winklevoss Bitcoin Trust, this exchange-traded fund is intended to be an easy way to invest in Bitcoin.

Bitcoin Forecast 2015: Four Powerful Trends Will Deliver a Pivotal Year

By David Zeiler , Associate Editor , Money Morning • @DavidGZeiler - December 18, 2014

Start the conversation

The Bitcoin forecast for 2015 is for major strides toward the promise we've been hearing about for more than a year.

The power of the idea - a decentralized, digital currency that includes ownership data and can move money around the world in an instant - just keeps gaining traction.

But the Bitcoin forecast 2015 isn't just for more of the same. For sure, mass adoption will continue. But next year we'll see a lot more activity on Wall Street as well as a lot more innovation from Bitcoin startups.

Invest in a Digital Future

In this next wave of the digital revolution, digital currencies are emerging as what many believe to be the greatest innovation since the advent of the internet.

For the first time in history, value can be sent anywhere in the world at the same speed as information, in a secure and trustless way. A departure from conventional economic, political, and social systems run by a handful of large centralized institutions, digital currencies are powered by millions of peers within a globally distributed network, democratizing information and value in incredible new ways. Several digital currencies, each with unique comparative advantages, may radically transform legacy systems across nations and industries around the world, driving future economic growth and becoming more valuable as the keys to our digital, global economy.

At Grayscale, we believe investors deserve an established, trusted, and accountable partner that can help them navigate digital currency investing. That’s why we are building transparent, familiar investment products that facilitate access to this burgeoning asset class, and provide the springboard to investing in the new digital currency-powered “internet of money.”

Simple and reliable market access

Supported by a network of trusted service providers

Titled auditable ownership through traditional investment vehicles

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Important Information

Grayscale Investments, LLC (“Grayscale”) is the sponsor of Bitcoin Investment Trust, Bitcoin Cash Investment Trust, Ethereum Investment Trust, Ethereum Classic Investment Trust, Litecoin Investment Trust, XRP Investment Trust and Zcash Investment Trust, and the manager of Grayscale Digital Large Cap Fund LLC. The trusts and the fund (collectively, the “Vehicles”) are private investment vehicles, are NOT registered with the Securities and Exchange Commission (“SEC”) or any other regulatory agency in any jurisdiction, and are NOT subject to the same regulatory requirements as SEC-registered exchange traded funds or mutual funds, including any requirement to provide certain periodic and standardized pricing and valuation information to investors. Shares of the Vehicles are not insured by the Federal Deposit Insurance Corporation or any other governmental agency. Investments in the Vehicles are speculative investments that involve high degrees of risk.

The shares of each Vehicle are intended to reflect the price of the digital asset(s) held by that Vehicle, less fees and expenses. However, none of the Vehicles currently operates a redemption program and any Vehicle may halt creations from time to time. As a result, there can be no assurance that the value of a Vehicle’s shares will approximate the value of the applicable digital asset(s) held by that Vehicle, and indeed, in cases where shares are transferable, they may trade at a substantial premium over or discount to the value of such assets. Moreover, the prices of the underlying digital assets are derived from third-party indices and reference rates, and no assurance can be given as to the accuracy of these prices.

Bitcoin Investment Trust, Bitcoin Cash Investment Trust, Ethereum Investment Trust, Ethereum Classic Investment Trust, Litecoin Investment Trust, XRP Investment Trust and Zcash Investment Trust are passive investment vehicles and their shares may be adversely affected by losses that, had they been actively managed, might have been avoidable. Grayscale Digital Large Cap Fund LLC is actively managed using proprietary investment strategies and processes. There can be no guarantee that these strategies and processes will produce the intended results and no guarantee that the fund will achieve its investment objective. This could result in the fund’s underperformance compared to other funds with similar investment objectives.

Investors in any Vehicle must have the financial ability, sophistication, experience and willingness to bear the risks of an investment in that Vehicle. Any offering or solicitation will be made only to certain qualified investors who are “accredited investors” as defined under Regulation D of the Securities Act of 1933 (the “Securities Act”). Qualified investors may only invest in a Vehicle pursuant to documentation made available by Grayscale, which should be read in its entirety. Information provided about a Vehicle is not intended to be, nor should it be construed or used as, investment, tax or legal advice, an investment recommendation, or an offer to sell, or a solicitation of an offer to buy, shares in any Vehicle. Any offer to sell or solicitation of an offer to buy shares in any Vehicle is made only by delivery to qualified investors of the offering documents for that Vehicle (the “Offering Documents”), which contain material information not available on this website and which, in the event of conflict, supersede any information available on this website in its entirety. In making an investment decision, investors must rely on their own examination of the applicable Vehicle and the terms of the offering contemplated by the applicable Offering Documents, including the risks involved.

The shares of each Vehicle are not registered under the Securities Act, the Securities Exchange Act of 1934, the Investment Company Act of 1940, or any state securities laws, and are being offered in private placements pursuant to the exemption from registration provided by Rule 506(c) under Regulation D of the Securities Act. As a result, the shares of each Vehicle are restricted and subject to significant limitations on resales and transfers. Potential investors in any Vehicle should carefully consider the long term nature of an investment in that Vehicle prior to making an investment decision.

Shares in the Vehicles have not been recommended by any U.S. federal or state or non-U.S. securities commission or regulatory authority, including the SEC. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of any information on this website or in the Offering Documents. Any representation to the contrary is a criminal offense.

Shares of Bitcoin Investment Trust and Ethereum Classic Investment Trust are quoted on the OTCQX® market under the OTC Market’s Alternative Reporting Standards, which do not require the same level of public disclosure as the standards applicable to SEC-registered investment vehicles.

Grayscale is a subsidiary of Digital Currency Group Inc. (“DCG”). DGC has interests in multiple digital currency ventures in addition to Grayscale. CoinDesk, the leading digital media, events and information services company for the digital asset and blockchain technology community, is also a subsidiary of DCG. CoinDesk is editorially independent from DCG and Grayscale, and any views or opinions expressed by CoinDesk are not the views or opinions of Grayscale.

Prospective investors in any Vehicle should carefully note the following:

• Each Vehicle represents a speculative investment and involves a high degree of risk.
• Investors could lose all or a substantial portion of their investment. Investors must have the financial ability, sophistication, experience and willingness to bear the risks of an investment in any Vehicle. In particular, each Vehicle invests in digital assets. The trading prices of many digital assets have experienced extreme volatility in recent periods and may continue to do so. In light of recent steep increases in the value of certain digital assets, multiple market observers have asserted that digital assets are currently experiencing a “bubble.” If these observers are correct, trading prices for the digital assets held by the Vehicles could experience steep declines in value and the Vehicles’ shares could lose all or substantially all of their value.
• An investment in any Vehicle should be discretionary capital set aside strictly for speculative purposes.
• Each Vehicle has a limited operating and performance history.
• Grayscale has authority over the management of each Vehicle and shareholders’ rights are extremely limited.
• Each Vehicle may involve a complex tax structure, which should be reviewed carefully, and may involve structures or strategies that may cause delays in important tax information being sent to investors.
• Each Vehicle’s fees and expenses (which may be substantial regardless of any returns on investment) will be paid using that Vehicle’s assets, which will reduce the assets of that Vehicle and the corresponding value of your investment, all else being equal.
• Each Vehicle and Grayscale, and their advisors and agents, are or may be subject to various conflicts of interest.

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How Bitcoin Investment Trust (GBTC) Works

If you want to speculate on the price of bitcoin -- and you aren't fond of sketchy bitcoin stocks -- Bitcoin Investment Trust (NASDAQOTH: GBTC) is the only way to do it with your brokerage account. It's an imperfect way to bet on bitcoin, but as the market's only bitcoin fund, it snaps up a lot of trading volume.

1. What is the Bitcoin Investment Trust (GBTC)?

This trust acts as a bitcoin fund of sorts, offering up the opportunity to bet on bitcoin by buying its shares. The trust owns bitcoins on its investors' behalf, entrusting them to the cryptocurrency custody service Xapo to keep them safe. Each share currently represents ownership of approximately 0.092 bitcoin, an amount that will slowly decrease over time as management fees are charged to the fund.

Image source: Getty Images.

2. What does it cost to own Bitcoin Investment Trust?

Funds are never free to own. The fund's sponsor, Grayscale Investment Trust, charges an annual management fee of 2% of the fund's assets. It's a relatively high management fee to pay, given gold ETFs charge as little as 0.25% per year to invest in physical gold stored in underground vaults. Amusingly, it costs more to keep bitcoin safe than it does to keep gold safe. Who would have thought?

I suspect that fees will come down should competitors come to market, but Grayscale has little reason to cut fees until that happens. Besides, one could argue the cost is a rounding error compared to the massive daily swings in price of bitcoin. Anyone who earned a 1,557.2% return on the trust in 2017 probably isn't too worried about the 2% management fee they paid that year.

To be sure, owning Bitcoin Investment Trust is a lot easier than buying the digital currency on an online cryptocurrency exchange. Convenience always comes at a higher price.

3. Is owning Bitcoin Investment Trust the same as owning bitcoin?

Yes and no. In theory, Bitcoin Investment Trust should generally rise in value when bitcoin rises, and fall when the price of bitcoin declines. In practice, on roughly one out of three trading days, bitcoin and Bitcoin Investment Trust actually moved in opposite directions.

The trust's popularity is to blame for its rather unpredictable performance. It's safe to say that Bitcoin Investment Trust is likely to outperform bitcoin when investors pile in, and underperform bitcoin when investors flee from its shares. It tends to overshoot both up and down, rising more than bitcoin when the digital currency soars in value, and falling faster than bitcoin when it declines in value.

Since going public, Bitcoin Investment Trust has closed at prices as high as 2.32 times the value of its underlying bitcoins. At its low, the trust closed at a price 0.1% lower than what its bitcoins were worth at the time. On any given day, the trust is likely to close at a value exceeding the value of its digital currency holdings, as on the median day it closed at a price 42% higher than what its bitcoins are worth.

If you can buy shares at a small premium, it may be worth paying up for the convenience of safely owning bitcoin through a vehicle you can buy or sell through an ordinary brokerage account. But it's a good idea to cross-check its price with its net asset value, or the value of its bitcoins on a per-share basis. It would be an unfortunate thing to pay such a high price that you end up losing money on Bitcoin Investment Trust over a period in which bitcoin rises in value.

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Bitcoin symbol

The Bitcoin sign is part of Unicode 10.0 (released June 2017) [1] with code point U+20BF (₿). As of June 2017, font support for the Bitcoin sign is in macOS Sierra, iOS, Android O beta, Windows 10 Creators Update and several Linux releases. After being rejected in 2011, [2] the Bitcoin sign was accepted for Unicode in November 2015 [3] and first appeared in Unicode 10.0 in 2017. [1]

Historically, similar looking Unicode symbols such as the Thai Baht (฿) have been used because the Unicode standard at the time had not included a symbol for Bitcoin. The capital letter B with stroke (Ƀ) was also used in contexts where it was likely that using the Baht symbol would cause confusion.

Currency code

The ISO 4217 currency code for Bitcoin is XBT. However, at the moment it is an unofficial code according to the ISO 4217 standard. The unit name BTC is also commonly used to represent one bitcoin, but it violates ISO 4217 because it begins with "BT", the country code of Bhutan. Bhutan does not actually use the code BTC for any currency, and XBT has not yet defined which unit it represents (just that it represents some unit of bitcoin), so the Bitcoin community is likely to continue using mainly BTC as a unit name and currency code for some time.

A formal application by the Financial Standards Working Group of the Bitcoin Foundation is nearing completion. [still true?] This application would request ISO 4217 standard to support XBT.

Inserting the symbol

In lieu of the Bitcoin symbol being included in the Unicode standard and its adoption into typographic fonts, BTC can be included in many documents by other means. This section focuses on online publications but the basic concepts apply to all publishing forms.

A package including a high resolution raster image with transparency (PNG), vector image (SVG) and TrueType font (TTF) is available [4]

The Bitcoin symbol can be inserted as an image, as is done in the opening sentence of this page. The benefit of this method is that any client that can display images in line with text will be able to display the symbol. The down side to this method is that as an image, it does not always degrade as nicely as a font. If using raster image, scaling the image up/down (to fit with surrounding text) may result in pixelation, inappropriate filtering, and other issues typical of raster images. If using a vector image, scaling concerns do not apply but the display would still not benefit from font-specific rendering features such as hinting. Both forms also suffer from client-specific considerations such as whether or not a box will be drawn around the image and the general inability to easily style its display; applying color requires specific CSS, and italicizing would require a CSS skew transform, for example.

When using an image in running text on a webpage it's generally a good idea to set the alt property to an appropriate value. For example, when depicting amounts you might use alt="BTC". Text including the symbol copied and pasted will then remain syntactically correct, replacing the symbol with BTC.

Sample HTML code:

Font Awesome icon

The Font Awesome collection of icons and symbols also includes the Bitcoin symbol. [5]

Sample HTML code:

As few fonts include the Bitcoin symbol, a special font was created by Theymos, originally for the BitcoinTalk forum. [6] The font consists of only the Bitcoin symbol ( BTC ) used in the glyph for the capital letter B. The text "BTC" can be entered and styled with this font, causing it to be replaced entirely with just the symbol on those systems that support this font, while on other systems the text "BTC" is retained. Similarly, copying and pasting text will still retain "BTC". This method is used on BitcoinTalk and the Bitcoin Wiki.

Bitcoin Arrives On Wall Street, Bringing Good News For Blockchain Entertainment

Bitcoin, the digital currency based on blockchain technology, exploded in price last week, shooting up to a high-water mark of $19,000 per single coin. It has since retraced to the $15,000 level, but is holding firm in that territory.

If some observers can be believed, this week’s run-up in price is a prelude to bitcoin hitting heights undreamed of when it was selling for several cents. In fact, John McAfee, the founder of the computer anti-virus software that bears his last name, has promised to perform a vulgar act of self-abuse if bitcoin’s single-coin price doesn’t reach $1 million by 2020.

While one week’s explosion doesn’t necessarily mean that good times have permanently arrived, it does create new opportunities for blockchain entertainment companies. Many startups are emerging that are funded by such cryptocurrencies as bitcoin and blockchain, and rising prices mean there is more liquidity in the market to service new ideas.

What’s driving this upward momentum? Each day, new reports emerge from financial talk shows from grumpy old men who call bitcoin as a fraud, a scam, and a way for criminals and terrorists to fund their activities.

But here’s the real story: those same financial giants have been quietly kicking the tires on bitcoin, and the first Wall Street exchanges have emerged that will make bitcoin subject to government oversight. Both exchanges deal in futures, which are complex financial strategies, but essentially are bets that something will move up or down in price in the future. What it really means is that bitcoin, one viewed strictly as a tech gimmick and a money laundering tool, is finally ready to join mainstream finance.

For the uninitiated, bitcoin is a digital currency that is decentralized, meaning no government controls it. It is based on blockchain technology, and new bitcoin can be created by a process called mining, wherein complex mathematical formulas are solved by machines. Bitcoin is sold via online exchanges, which serve the role that banks would with traditional fiat money.

The price of bitcoin was around $1,000 per single coin at the beginning of 2017. It has since gone up exponentially, with investors pouring into the market and creating new companies to exploit bitcoin and its underlying blockchain technology. Major banks, insurance companies and even governments have been actively involved in promoting – and sometimes policing – the wild west of bitcoin. But so far, nothing has stopped its growth.

Now, bitcoin is about to enter a new phase. The big boys of Wall Street are entering the picture.

CBOE Holdings, the largest US options exchange, earlier announced that it was teaming with Cameron and Tyler Winklevoss’s Gemini Trust Co. to creative a vehicle for bitcoin derivatives. You know the Winklevoss twins if you saw The Social Network, which portrayed how Mark Zuckerberg took their concept for Facebook and expanded on it. The Winklevii challenged him in court, and used their settlement funding to make themselves the first bitcoin billionaires.

The agreement with CBOE uses Gemini’s bitcoin data to create futures on bitcoin. Chicago-based CBOE plans to start its trading platform as of today. CBOE also has the right to create and distribute new indexes under the contract.

Cameron Winklevoss told the Wall Street Journal that the agreement “will bring more participants into the market who will now be able to express a viewpoint on bitcoin.”

Also getting in the game is t he CME Group, which has been given the green light by federal regulators to start trading bitcoin futures as of Dec.18. CME is the owner of the Chicago Mercantile Exchange and owns and operates large futures and derivatives exchanges. It also owns the Dow Jones stock and financial indexes, and the CME Clearing Services, which settles exchange trades.

All of this will likely excite mom and pop investor to finally jump into the bitcoin game. Many institutional investors are counting on that surge to lift the overall market, and perhaps make the futures market eventually even bigger than the direct buys of digital currency.

For the emerging blockchain and cryptocurrency entertainment companies, this is only good news.

Adi Sideman, CEO of Props by YouNow, a social media video play, sees the instiutional investors as the driving force.

“The attention bitcoin is getting in the general markets is good news for all crypto projects, as it creates more awareness and validation of the space,” said Sideman.

Of course, as with all investments, past performance is no indicator of future success. But the presence of seasoned investors and executives in the space augers well for its prospects. It just might be possible that John McAfee will never have to do anything other than count his bitcoin riches.

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