Bitcoin Investment Trust declared a 91-for-1 stock split last week. Each holder of record will receive ninety one new shares for every single share already held. The exchange traded fund, which tracks the spot price of bitcoin, will trade at a proportionally lower price once the split settles. The move lowers the entry cost for retail investors who previously faced a share price above one thousand nine hundred dollars.
At the close of the last session GBTC slipped twelve point six percent to one thousand seven hundred twenty dollars. Market capitalization totaled three point six eight billion dollars. After the split the implied price per share equals eighteen dollars and ninety cents.
Bitcoin fell twenty percent during the morning session on reports that regulators in South Korea but also China planned tighter controls on cryptocurrency exchanges. Seoul authorities signaled a possible ban on anonymous trading accounts. Beijing officials reiterated warnings to local exchanges to curb capital outflow.
The trust holds physical bitcoin on behalf of shareholders. For months it operated as the sole regulated vehicle offering direct exposure to the digital currency in U.S. brokerage accounts. Scarcity drove the share price to a sustained premium over the underlying coin holdings. The fund replicates bitcoin’s daily price swings with near one-to-one sensitivity.
On December seventeenth, when bitcoin peaked near twenty thousand dollars, each GBTC share represented zero point zero nine one nine bitcoin. After the split each share will correspond to zero point zero zero one zero one bitcoin. The proportional reduction in bitcoin per share does not eliminate the premium, yet the lower nominal price broadens the pool of potential buyers and deepens secondary market liquidity.
Michael Sonnenshein, director of the trust, told CNBC that the product remains the only regulated vehicle that investors may purchase at net asset value. He added that the firm collaborates with banks and broker-dealers to educate clients about the structure and risks of the asset class.
Sonnenshein cited sustained trading volume as evidence of robust demand. The observation supports the business case for pending applications from other issuers seeking approval to launch competing bitcoin ETFs.
Sonnenshein expects regulators to authorize additional bitcoin ETFs within the next twelve to eighteen months. His firm, which already sponsors trusts for ethereum and zcash, plans to introduce a multi currency basket product that will hold equal dollar weights of bitcoin, ethereum, litecoin along with bitcoin cash.
Trading or holding digital tokens involves substantial risk of loss. The article does not constitute investment advice. Prospective investors should consult a licensed financial adviser before committing capital. The author holds a modest personal position in bitcoin. The author discloses no holdings in bitcoin cash, bitcoin gold, or other forks at the time of publication.
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