Bitcoin: Investment Vehicles Are Quite Bearish

SummaryThe GBTC trust value in the stock market is cheaper than the underlying value of the Bitcoin asset by about 32.75%.The daily trading volume of GBTC has sharply dropped to 3.075M, despite the generous discount of the shares.The Sharpe ratio tells us that GBTC is a poor asset with a very low risk-adjusted performance.Total Bitcoin holding by trusts and ETFs has plummeted since May 2021.Investment ThesisWhilst the Grayscale Bitcoin Trust (GBTC) has been traded at a significant discount, some trusts and ETFs have been urged to reduce their Bitcoin holdings and the daily trading volume in these assets has steadily declined. For a while, the Sharpe ratio shows that GBTC's return on investment is rather low and that this asset appears to be quite risky.Negative Sentiment Spreads Across Stock MarketsSince November 2021, the value of Bitcoin (BTC-USD) has tanked nearly 70% in value from the all-time high, which has many investors on edge. Meanwhile, many analysts believe that a great recession is coming, causing market sentiment to become more negative than ever. The weakness in the equity markets shown in the S&P 500 and Nasdaq 100 indices makes this most obvious, which significantly affects investment behavior in Bitcoin through regulated markets.30-day Pearson correlation to Bitcoin for S&P 500 and Nasdaq 100 indexes has been relatively high since early 2022. (The Block)Looking at the Grayscale Bitcoin Trust, the shar...