Spot Bitcoin ETFs narrow gap to Net Asset Value, signaling market maturity 
Quick Take
The Bitcoin Exchange-Traded Funds (ETFs) have passed through 11 trading days, revealing interesting dynamics about their performance against the Net Asset Value (NAV).
An ETF’s ideal situation is for its market price to equal the NAV per share. The Grayscale Bitcoin Trust (GBTC), for example, once traded at a hefty 50% discount. However, following its ETF conversion, the discount has impressively tightened to a marginal -0.22% after day ten, a considerable movement from day two (-2.6%,) according to ETF analyst James Seyffart.
In contrast, the majority of the newborn nine ETFs commenced with over a 2% premium, but by day ten, they were trading around 0% – 0.5%, according to James Seyffart.
The arbitrage bandwidth between every spot ETF is calculated as “the highest premium (or discount) minus the lowest discount (or premium) at 15-minute intervals throughout the trading day”, according to James Seyffart.
Strikingly, from a momentarily high of 8% on day one, it’s now trading at a more restrained 0.35%. The shrinking of these premiums and discounts bodes well for investors, suggesting a healthier market environment. This convergence towards the NAV fosters confidence, limits arbitrage opportunities, mitigates market risk, and ultimately facilitates fair pricing.
Analyst 
James Van Straten
James fervently appreciates data, technology, and trend-spotting. As a tech and liberty maximalist, he hails Bitcoin as the 21st century's paramount invention.
Latest Insights
In this insight
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
James Seyffart is a well-regarded analyst at Bloomberg Intelligence, specializing in Exchange-Traded Funds (ETFs) and the broader fund industry.
Grayscale Investments
Established in 2013 by Digital Currency Group, Grayscale Investments is a trusted authority on digital currency investing and cryptocurrency asset management.
