SEC Filings: Grayscale Bitcoin Trust Posted $144M Q1 Loss

Grayscale’s Bitcoin Trust (GBTC), facing record investor outflow, posted a loss of $144.3 million during its first quarter according to SEC filings. 

According to its 10-Q filing, the trust increased its bitcoin holdings to 654,600, up 8% from the end of 2020. The company said that the total value of its bitcoin holdings is just north of $38.4 billion, up over 100% compared to the $17.7 billion it held at the end of 2020 as the price of bitcoin hit record highs. 

Filings show that the trust increased its bitcoin holdings by 17% during the first quarter of 2020, 27% during the year’s second quarter, 16% in Q3 and 35% in the last quarter. Likely the trust didn’t see the need to augment its holdings in such a substantial way during the last quarter given the parabolic rise in the price of bitcoin. 

Between Grayscale’s multiple trusts for different digital assets, the firm manages nearly $52 billion in assets.

During the quarter, Grayscale has been battling a significant discount on its shares as bitcoin ETFs listed in Toronto soak up most of the capital that was once destined for the trust. As an apparent mea culpa, in April the company said it had filed to convert the Trust into an ETF. 

DCG, the Trust’s parent company, has been increasing its authorization for share buybacks in order to push back the discount. So far DCG has purchased $193.5 million worth of the Trust’s shares and is authorized to buy $750 million. Filings show that $81.3 million of these shares were purchased in the first quarter of 2021.

According to 13F filings, GBTC remains a popular investment vehicle with fund managers. Many funds have increased their holdings during the last quarter to boost exposure to bitcoin’s price — at a discount.