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This week’s data from Arcane Research shows that there has been strong demand for Grayscale’s crypto trusts recently launched on the stock exchange. Following the trusts that achieved DTC eligibility last Monday, LTCN (litecoin) shares were sold for a 753% premium while BCHG (bitcoin cash) shares were sold for a 351% premium.
Grayscale Investments’ Litecoin Trust (LTCN) and Bitcoin Cash Trust (BCHG) have been experiencing intense demand since their official launch last Monday.
According to Arcane Research statistics, LTCN was selling for a 753% premium while the BCHG Trust was selling for a 351% premium.
Trading of both trusts was unsuccessful until the next day and Arcane Research said that LTCN “has been trading for an incredible premium since launch”.
“Currently, LTCN’s premium is a whopping 753%,” Arcane tweeted. “High retail demand for LTC exposure generates profitable returns for early confidence investors.”
The grayscale recently exceeded $ 6 billion in AuM.
Grayscale offers several publicly traded trusts. These trusts are sold to the public on the secondary market at large premiums relative to the underlying value of the shares (NAV).
Discussion: Publicly traded grayscale products👇 pic.twitter.com/x2mnoAo0Qo
– Arcane Research (@ArcaneResearch) 20 August 2020
Arcane said the main drivers of grayscale rewards include investors buying directly into the trust [who] seeks compensation for the lockout period, the high retail demand for exposure to cryptocurrencies through 401,000 savings, with few other options. The researchers also added that some investors may not be aware of the awards.
“The grayscale [Bitcoin Cash] Trust was also launched this Tuesday, and was also traded for a big prize, “added Arcane’s Twitter post.” BCHG’s current premium is 351%. “
Arcane added that the BCHG award has decreased since the launch of the trust. After also tweeting about LTCN, BCHG and ETHE trust, Arcane said the public demand for digital assets makes the perfect time to implement an exchange traded fund (ETF).
“Overall, the rewards of grayscale products are far higher than they should be when block compensation is taken into account,” the researchers noted.
Arcane further said:
The awards show that the public demand for exposure to cryptocurrencies is high and the market is ripe for an ETF.
Discussing the data for the Ethereum Trust (ETHE), Arcane wrote that the trust is worth $ 837 million in assets under management (AuM) or 1.8% of the ETH supply. Arcane noted that when trust went out the gate, the “premium went up over 800%,” but it has since normalized.
“The publicly traded shares of the trust (ETHE) are currently trading at a 93.7% premium over the NAV,” the researchers said Friday.
What do you think of LTCN and BCHG shares trading well above the NAV? Let us know what you think of these trusts in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
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