Bitcoin ETFs flash signs of stress as discounts reach records
While that type of dislocation is typically a troubling sign for an ETF, the chief investment officer of one issuer called it “more an accounting quirk than a real issue” due to the unusual way in which the funds track the value of their assets.
The discounts appeared in closing data after the cryptocurrency sank to a two-month low on Tuesday, including a dip of about 2% between 3 p.m. and 4 p.m. New York time, which is the hour in which average prices are used to track the value of the ETFs’ Bitcoin. The $16 billion iShares Bitcoin Trust (ticker IBIT) on Tuesday closed about 1.7% below its net asset value — the largest dislocation since it began trading in January, according to data compiled by Bloomberg. The $9 billion Fidelity Wise Origin Bitcoin Fund (FBTC) saw a 1.1% discount while the $2.5 billion ARK 21Shares Bitcoin ETF (ARKB) and the $2 billion Bitwise Bitcoin ETF (BITB) both closed with discounts of more than 1.4%, also the biggest on record for each.
“That’s not a great look,” said James Seyffart, ETF analyst at Bloomberg Intelligence, adding that it would have been more concerning if the discounts were isolated to one fund. “It’s a little out of the ordinary in the fact that we’ve seen premiums and
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