• richard_ISC@alien.topBEnglish
    1·
    1 year ago

    GSOL will follow the same path as GBTC.

    DON’T FALL FOR IT. IT IS AS CLOSE TO A PONZI AS THE LAW ALLOWS.

    How the scam works (taking GBTC as an example):

    1. List GBTC, and allow user to deposit BTC to get GBTC out. Note that users who do this will NOT be allowed to sell their GBTC for 6 months.

    2. GBTC having a tiny market cap, they PUMP the price of it, and keep it at a massive premium. Think 40-50% premium.

    3. Arbitrageur start to think: Wait… I can deposit BTC, and get the equivalent in GBTC which is worth 40-50% more ???

    4. “Yes sir! You can do this! This is because institutional money is dumb dumb and cannot WAIT to get access to BTC! They also aren’t able to structure a trust themselves!!” -> this is a PR move to explain the premium. In reality the premium is artificial. It exist because insider pumped the price, and no one is able to sell yet. Meanwhile, more and more arbitrageur deposit BTC inside GBTC.

    5. The 6 months expire, and everyone dumps their GBTC hoping to FINALLY capture the 40-50% premium. The premium is gone.

    6. When people realize their GBTC is like holding BTC… but its not even like holding a BTC (no self custody, cannot be moved), they start to decide they should sell their GBTC and buy BTC instead.

    7. The price of GBTC drops FAR below BTC. This is because there is NO WAY OUT of GBTC. People can deposit BTC, but cannot withdraw BTC. GBTC were trading at a 40-50% discount for about a year.

    8. Why they do this? Because they get to collect 2-3% ANNUAL FEE. FOREVER*.

    • A lot of people will say that they are working on turning it into an ETF. I strongly believe this is false as… it would mean the end of their business model.

    Grayscale is racking $400M in fees ANNUALLY out of this scam. There is no way out. A slow drain of 2% per year… forever.

    And now they are starting a new GSOL with the same intention.

    STAY AWAY.

    • Free-Bass-2022@alien.topBEnglish
      1·
      1 year ago

      You’re bang on the premium was insane at the start of the year, its now only 15% ETHE was near 50%, again now down to about 13%

      Its well worth the play, I cant access it in my tax free account otherwise I would be all over it.

      As it is I have been eyeing MSTR and BTC as a pair to Arb as I dont mind holding either tbh

      Thing is if they convert to BTC and they will as they are the 2nd biggest BTC whale after Satoshi, surely they will charge the 2% and custody the BTC?

      • richard_ISC@alien.topBEnglish
        1·
        1 year ago

        If you buy in, your only way out will be another sucker down the line that want to buy your “BTC” that deflate at 2% per year.

        The tax savings aren’t worth 2% on performance AND thr lock in.

        Imagine what will happen to your GBTC if an ETF is successfully launch? It will go to a massive discount. They have ZERO incentive to allow you to convert GBTC to BTC. They are “trying”.

        The way it will all end is that they will eventually be sued at some point into unwinding.

    • cyger@alien.top
      BEnglish
      1·
      1 year ago

      You call it a scam, but I got a ~100x in my IRA because of GBTC purchased in 2015. Yes the fees are dreadful, but it hard to get BTC exposure in an IRA without GBTC currently.