Grayscale Halts Investment in Its Trusts After Recent Bitcoin Surge
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Grayscale Halts Investment in Its Trusts After Recent Bitcoin Surge

December 22, 2020      Vandana Malik

Grayscale, a huge investment management firm, has taken a step to temporarily halt investment in its various trusts. It is revealed that Grayscale halts investment in both Bitcoin and Ethereum trusts. This news came after the recent surge in Bitcoin as it reaches a new all-time high. Other trusts for whom it will not be accepting investments are Ethereum ClassicBitcoin Cash, Digital Large Cap Fund, and Litecoin

Grayscale Halts Investment as Its Six-Month Lock-Up Period Is Ending

It is revealed that Grayscale halts investment because its six-month lock-up period is now coming to an end. This lock-up period was for selling the shares of the Bitcoin fund which were purchased recently. It is also revealed that this is going to harm the GBTC holders and there will be implications for the firm’s crypto buying strategy as well. 

The shares of Grayscale Bitcoin Trust that comes under GBTC usually trades at a higher price as compared to the one with Bitcoin. The reason being that a lot of institutional investors wish to buy something that is an alternative to Bitcoin. Another reason is that GBTC shares are available for trading on the existing stock exchanges. All the shares that have been brought during the starting of this lock-up period can now be sold to the open market. All the investors who are unable to invest in the Grayscale Bitcoin Fund will be able to do so by purchasing these shares. 

Buying Bitcoin For Grayscale’s Fund Could Be Cheaper 

Moreover, it has to be noted that if people will start purchasing these shares, buying Bitcoin for Grayscale’s fund will become a lot cheaper. This will ultimately lead to more purchases for all those traditional investors. It is not for the first time that Grayscale has halted investment for its funds as it has done this earlier as well. Whenever the lock-up period comes to an end, the investments are paused.

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Vandana Malik
Vandana Malik

Vandana has received Master of Arts degree in English from GEU Dehradun. She is currently working as a content writer with Agio Support Solutions and earlier worked as a sub-news editor at Business News and Information Services Private Limited. She is an enthusiastic content writer and aims to bring a compelling yet informative content to the audience. Meanwhile, enhancing her own knowledge in the cryptocurrency and blockchain industry.