The 2013 origin and the 2026 fee war

The 2013 Origin

Grayscale launched GBTC in 2013 through a private placement for accredited investors. Under Regulation D Rule 506(c), issuers must take reasonable steps to verify that an investor meets the $200,000 income or $1 million net worth thresholds. The SEC staff noted in a March 12, 2025, Latham letter that high investment amounts might allow issuers to skip certain verification steps if they confirm the cash investment does not come from a third party. I observe that this guidance reduces the need for investors to produce sensitive documentation like tax returns, K-1s, or W-2s. Previously, high net worth and institutional investors produced such documentation at least once a year. If a verification service was used, the information could not exceed 90 days of age, forcing four annual refreshes. Rule 506(b) allows for up to 35 non-accredited investors if the issuer establishes a preexisting relationship, but 506(c) only allows sales to accredited investors. This streamlined process helps fund managers avoid delays in private equity or hedge fund formation.

The Fee Conflict

GBTC outflows reached \$12 billion as the market matured, largely because of the 1.5% management fee. I see the impact of these high costs when comparing GBTC to competitors like BlackRock or Fidelity. Michael Sonnenshein, the Grayscale CEO, defended the fee in April 2022 by stating that other issuers used lower fees to lure investors to products without a track record. I find this defense unconvincing since VanEck waived fees entirely until March 2025. You should note that Grayscale later introduced the Grayscale Bitcoin Mini Trust, which trades under the ticker BTC, to provide a lower fee option. On a single Monday, GBTC recorded a withdrawal totaling \$643 million. The FTX bankruptcy estate also offloaded the majority of its 22 million shares held in GBTC. This selloff followed the bankruptcy of the crypto giant in November 2022. Sonnenshein noted that the firm was between the first and second inning of the market. Traders chased the GBTC premium in July 2021, but those positions eventually faced liquidation as the arbitrage trade died.

2026 Market Status

Bitcoin climbed 12% over five days in September 2026, moving above the \$86,000 level. On September 21, 2026, global Bitcoin ETFs gathered \$690 million in net inflows. I note that GBTC traded at a 0.00% premium to its net asset value on September 22, 2026, after years of trading at an average 35% premium. The price of GBTC sat at \$65.32 in September 2026, while the price reached \$61.02 in August 2026. I see a massive difference between the current price and the \$89.77 recorded in September 2025. The price was \$45.52 in June 2026. In January 2024, ten spot Bitcoin ETFs launched in the U.S. after receiving SEC approval, and GBTC remains the only ETF to see net outflows of more than \$10.6 billion since that time. I find the current price stability interesting given the volatility of previous years. Will the current momentum sustain the price despite rising inflation and high 10-year US Treasury yields?