Bill Miller plans $400M Bitcoin investment via GBTC

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Hedge fund legend Bill Miller shows an even greater appetite for bitcoin (BTC). According to Friday’s SEC filing, The Miller Opportunity Trust wants to get indirectly involved in BTC through Grayscale Bitcoin Trust.

The proposed investment comes at a time when the GBTC premium is at its lowest level since April 2019.

If the purchase of GBTC shares goes ahead, it would represent a significant change for the $2.25 billion fund from traditional investments in equities and derivatives. The trust’s website lists airlines, healthcare and finance as the main areas of investment.

Since the fund’s exposure to bitcoin is limited to 15% of assets under management, GBTC’s costs could exceed $300 million. As part of the statement, the Trust commented on price volatility: The use of bitcoins in retail is relatively small compared to the relatively large use of bitcoins by speculators.

Miller himself is a well-known supporter of bitcoin. In 2016, the legendary Wall Street investor invested 30% of his hedge fund in bitcoin. Since then, that share has risen to over 50%, and the BTC game has contributed to a huge increase in the value of Miller’s hedge fund.

Last January, Miller famously contrasted Warren Buffett’s rat poison with his. The comments echo comments from 2018 by Pantera Capital CEO Dan Morehead, who said something like bitcoin is rat poison because banks are rats.

Bitcoin recently reached $40,000 over the weekend, its highest price level in nearly a month. The move above $40,000 was met with a quick return below $38,000, however, with the largest crypto-currency capitalization falling nearly 2% in the last 24 hours of trading.

frequently asked questions

Is GBTC a good way to invest in bitcoin?

Although GBTC is a pure bitcoin trust, the unit price of GBTC does not exactly match the price of the underlying bitcoin. … However, it is the fastest way for stock market investors to gain exposure to cryptocurrencies without having to buy their own bitcoins. That’s because regulators have not yet approved the bitcoin ETF.

What is the premium of GBTC over Bitcoin?

GBTC has traditionally traded at a high premium to the underlying bitcoin, with an average premium of 15.02% since inception.

How much of Bitcoin is GBTC?

In October 2018, each GBTC share was worth less than 0.001 bitcoin. This means that it takes more than 1,000 GBTC shares to own one bitcoin.

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