Shares of Bitcoin Inv. Trust (GBTC) Soar to 5.5-Month High on BTC Rally

Shares of Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term Investment Trust (OTCMKTS:GBTC) have soared to their highest level in 5 1/2 months amid heightened demand driven by bitcoin's relentless rally.

Bitcoin (BTC/USD) hit another 2015 high of $342 today on Bitstamp, bringing its year-to-date return to +6.9%. It has surged by nearly 20% in the last week alone, and over 50% since its lows near $220 in September.

Shares of GBTC had, up until late last week, appeared uninspired by the bitcoin rally. For the first time, shares actually traded below their implied bitcoin value for a couple of days, in stark contrast with the typical premiums of 10% to 25% seen for most of their public tenure. At one point last week, they traded at a 4.4% discount to bitcoin.

Today, they rose by 9% to a high of $37.00, reflecting a 13% premium over the average bitcoin price. Investors in GBTC may now be willing to pay more to join bitcoin's rally, which has finally achieved new 2015 milestones.

The erratic behavior of the shares may also be an outcome of their limited Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term, leading to periodic spurts of outsized price movements in either direction. In addition, the latest legs of bitcoin's rally have become increasingly disorderly, with price spreads as high as 12.7% between major exchanges. As such, there is a larger margin of error when defining bitcoin's going market rate.

On Friday, a record 36,700 shares exchanged hands.

Each GBTC share currently represents 0.09588987 BTC, or one tenth of a bitcoin less the 2% annual management fee that has been levied on the fund since its inception two years ago.