The Bitcoin Investment Trust™ is an open-ended trust that is invested exclusively in bitcoin and derives its value solely from the price of bitcoin. Modeled on the popular SPDR Gold ETF, the Bitcoin Investment Trust was created for investors seeking exposure to bitcoin through a traditional investment vehicle. The Bitcoin Investment Trust is publicly quoted on OTCQX®, the top tier operated by OTC Markets, under the ticker: GBTC.
Ease and Peace of Mind
Often, individuals and institutions seeking to directly purchase or sell bitcoin must transact via newly-established, unregulated exchanges or intermediaries. This often requires investors to transmit funds to geographies where they might not be comfortable. In addition, storing bitcoin on one’s own can add additional headaches, as the private keys (the bitcoin equivalent of passwords) which ensure access to an investor’s bitcoin can be susceptible to loss or theft. This potentially exposes one’s bitcoin position to partial or total loss, often with limited or no recourse to regain access to the bitcoin.
In contrast, by investing in Bitcoin Investment Trust shares, investors avoid the challenges of purchasing and storing bitcoin on their own and instead, pass these tasks to Grayscale and the Trust’s service providers, while maintaining their exposure to the price performance of bitcoin. The Bitcoin Investment Trust’s assets are safeguarded by a robust security system, using industry leading security standards. The system’s underlying protocols are state of the art, designed by experienced security, financial, and technology professionals, and are overseen by a financial operations principal. The Bitcoin Investment Trust’s financial statements are audited annually by Friedman LLP.
Cost Effective Order Fulfillment
Purchasing large orders of bitcoin can be challenging. Few bitcoin exchanges and order books can reliably fill orders of $25,000 or more without significant price slippage. Depending on the timing and size of the transaction, a trade on a given exchange could move the market materially. The Bitcoin Investment Trust’s authorized participant executes large purchase and sale orders through exchanges and over-the-counter transactions, and create shares for investors at a blended daily average price based on the TradeBlock XBX Index.
Titled, Transferable, and IRA Eligible
In contrast to directly owning bitcoin, shares of the Bitcoin Investment Trust™ are titled securities, similar in structure to other unregistered common stocks and bonds that investors may own. With a structure that is familiar to financial and tax advisors, and easily transferred to beneficiaries under estate laws, Bitcoin Investment Trust shares are eligible to be held in certain IRAs, 401ks, and other brokerage and investment accounts.
The Bitcoin Investment Trust™ charges an annual administration and safekeeping fee of 2.0%, which accrues daily. For further details on the Bitcoin Investment Trust’s fees, please review our Disclosure Statement.
Qualified accredited investors are eligible to directly invest in the Bitcoin Investment Trust and purchase shares at the daily NAV. Shares purchased directly from the Bitcoin Investment Trust are restricted and subject to significant limitations on resale and transferability. Conversely, investors may choose to purchase eligible Bitcoin Investment Trust shares on OTCQX® under the ticker: GBTC at the applicable market price. These securities have been deemed freely tradeable under SEC Rule 144 and are not subject to restrictions on resale or transferability once purchased.
The Bitcoin Investment Trust’s NAV is calculated and published each business day at 4PM EST. The NAV calculation is based off of TradeBlock’s XBX Index, taking into account a trailing 24-hour VWAP across the major bitcoin exchanges. For further details on how the Bitcoin Investment Trust’s NAV is calculated, please review our Disclosure Statement.
Grayscale Investments has received approval from a variety of retirement account service providers who can help to facilitate an investment in the Bitcoin Investment Trust™ through the ongoing private placement. Currently, these include: PENSCO, Entrust, Millennium, Equity Institutional, IRA Services, Madison Trust, and Midland IRA. If your IRA or retirement account provider is not listed, please inquire with the Grayscale team.
Most IRA providers will allow you to purchase publicly quoted Bitcoin Investment Trust shares via OTCQX® under the ticker: GBTC. Please contact your IRA provider if you have any questions related to purchasing publicly available shares of the Bitcoin Investment Trust™.
The Bitcoin Investment Trust’s assets are stored with Xapo, Inc., as Custodian, in deep cold storage vaults. Bitcoin stored in the Xapo Vaults reside on multisignature addresses, the private keys for which are protected by intense cryptographic, physical and process security. Xapo maintains third-party insurance to cover losses due to employee dishonesty or on-premises theft of bitcoin stored in the Vaults.
Shareholders generally will be treated, for U.S. federal income tax purposes, as if they directly owned a pro rata share of the underlying assets held in the Trust. Shareholders also will be treated as if they directly received their respective pro rata shares of the Trust’s income and proceeds, and directly incurred their pro rata share of the Trust’s expenses. Most state and local tax authorities follow U.S. income tax rules in this regard.
Prospective and current investors should consult their financial and/or tax advisors prior to investing.
An accredited investor, in the context of a natural person, includes anyone who either earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year, OR, has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence).