GBTC, the grayscale bitcoin trust, fell nearly 50% on Thursday. GBTC was created to give investors the opportunity to gain exposure to bitcoin through a traditional investment vehicle. Based on data from TradeBlock, Grayscale Bitcoin Trust was trading at a discount of 47.3% at the time of publication.
Grayscale’s parent company, Digital Currency Group (DCG), also owns Genesis Global Trading. Amid fears that Genesis Global Trading might go bankrupt, Genesis Global Trading, which is owned by DCG, halted customer withdrawals from Genesis Global Capital.
There was speculation on Twitter that a cascade of liquidity issues at DCG subsidiaries might ultimately lead to the liquidation of GBTC, which would result in a massive dump of Bitcoin. This, in turn, could lead to an even bigger sell-off of the cryptocurrency and a major crash in the Bitcoin price.
To counter these fears, Grayscale released a statement confirming that the company has sufficient liquidity to meet all customer redemptions, and that GBTC was not at risk of liquidation. The statement also noted that Grayscale is a long-term holder of Bitcoin and would not engage in any kind of panic selling.
