Bitcoin – I read the annual report (10K) of the $28bn Grayscale Bitcoin Trust (GBTC US) and found the disclosures frightening:


The Trust is not registered as an investment company under the Investment Company Act

The Sponsor has the exclusive management, authority & control of all aspects of the activities of the Trust.


The Sponsor is neither:
– An investment adviser registered with the SEC, nor
– A commodity pool operator registered with the CFTC

And takes 2% in fees per annum

The redemption of Shares is not currently operated or contemplated (dealing in shares would require regulation..)

If Bitcoin is determined to be a “security” under federal or state securities laws by the SEC, it may have material adverse consequences for Bitcoin – more difficult to be traded, cleared or custodied.

There is no clearinghouse for Bitcoin, nor a central or major depository for the custody of Bitcoin.

There is a risk that some or all of the Trust’s Bitcoin could be lost or stolen.

But under its parent company, the Custodian only has “crime insurance” coverage of up to $255 million

And the Sponsor may dissolve the Trust if SEC determines it to be an investment company or requires any license

My view – Bitcoin and GBTC are uninvestable – regulation is coming, expect an accident.