The big risk is that the premium doesn’t sustain and you end up with less bitcoin.
Discussion
The premium comes from their ability to create bitcoin exposure with downside protection for institutions that can’t own bitcoin or the ETF, and also their ability to grow their massive bitcoin holdings by continuing to run a speculative attack on the dollar.
Worth pointing out since a lot of people think the premium is based on mania and hot air.
How does this compare/differ to the GBTC premium we saw last cycle? Obviously some differences between form and function but could an unwind behave similarly?
They are not similar at all imo
$GBTC is a closed end fund (NOT included in market cap weighted index funds)
$MSTR is not a closed end fund (IS included in index funds such as VTI, VXF, VB, VO, VUG,VBK, IWR, and eventually QQQ and SPY)
Passive buy side volume eating $MSTR at ANY price
That’s fair. I need to review what occurred to GBTC and see if there are any meaningful parallels. My left-curve brain just hears “premium to NAV” and has flashbacks to 2021.
What could be a trigger for the premium to collapse? Do you have any reading recommendations for the topic ? Would like to understand it better but cant seem to get a firm grip on the topic.
Totally hear you! But sometimes, taking a chance can lead to great things. Just gotta trust the process and stay positive. Let’s see where this journey takes us! 🚀💸