DCG Authorizes Additional $500M for GBTC Buyback

The share purchase authorization does not bind Digital Currency Group (DCG) to acquire any sort of shares but rather increases the available ceiling.

article-image

Source: Shutterstock

share

key takeaways

  • Grayscale Bitcoin Trust parent Digital Currency Group now authorized to purchase up to $750 million in GBTC shares
  • GBTC’s AUM is now at $36 billion, and the company says its still on-track to converting it to an ETF

Grayscale’s parent company, the Digital Currency Group, announced Monday that it had upped the GBTC buyback authorization to $750 million.

DCG noted in a statement that it had already purchased $193.5 million worth of shares of GBTC. In mid March DCG announced that it had authorized a $250 million buyback, which some called a prudent move to shore up liquidity.

“This is due to the illiquidity and difficulty to perform daily redemptions. ETFs don’t have that problem, as they create and redeem daily, forcing trading closer to NAV,” Steven McClurg, Chief Investment Officer of Valkyrie Investments explained to Blockworks at the time.

To be sure, this share purchase authorization does not bind DCG to acquire any sort of shares. Instead it increases the available ceiling. DCG plans to use cash on hand to fund the purchases.  

Blame Canada

The GBTC premium remains stuck in a rut largely because of the success of multiple Toronto-listed bitcoin ETFs. Capital that was once destined for GBTC instead has gone north, attracted by the ETFs’ liquidity and quick redemption.

Data from Glassnode shows that there hasn’t been fund inflow into GBTC since the beginning of March, while the Trust’s bitcoin holdings have dropped significantly just as the holdings for the Purpose Bitcoin ETF have taken off.

Source: Glassnode

The GBTC premium is currently at a -13.5% discount. The last time it posted positive was at the beginning of March. It hit an all time low of nearly 19% at the end of April, according to YCharts

But according to 13F filings, quarterly declarations made to the SEC by fund managers, reviewed by Blockworks, GBTC remains popular with fund managers. Only four of the roughly 40 funds that hold GBTC have closed their position in the last quarter while five reduced their holdings. 

The waiting game

For its part the SEC has delayed a decision on approving the first US-listed bitcoin ETF until June. There are currently 11 applications pending, according to Bloomberg Intelligence. By law, the SEC has a maximum of 240 days to make a decision about an ETF application which puts a decision date to mid-June at the latest. 

But further competition abounds. In late March, the Brazilian Securities and Exchange Commission (CVM) announced that it had approved Brazillian-based digital asset manager QR Capital’s application for a bitcoin ETF to be listed on the São Paulo-based B3 Stock Exchange. It’s expected to begin trading by June 2021. 

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Featured.png

Research

Helium stands at a pivotal moment in its evolution as a decentralized wireless network, balancing rapid growth, economic restructuring, and global expansion. With accelerated growth in domestic DAUs and Hotspots supporting its network, Helium is leveraging strategic partnerships and innovative proposals to scale internationally. The recent implementation of HIP 138, “Return to HNT,” has unified its token economy under HNT, simplifying participation and strengthening liquidity, while HIP 139’s phase-out of CBRS refocuses efforts on scalable Wi-Fi offload. Meanwhile, governance shifts under HIP 141 raise questions about centralization as Nova Labs consolidates control over the roadmap.

article-image

In 2011, WikiLeaks faced a financial blockade imposed by the US government. It was Bitcoin’s first major test.

article-image

Kado’s founder Emery Andrew spoke to Blockworks about the acquisition and what’s next for the team

article-image

LayerZero’s Bryan Pellegrino chatted with Blockworks about the firm’s next steps and its 10-year runway

article-image

Colosseum co-founder Matty Taylor is seeing “high-performance [Solana] founders showing a lot of interest in private trading technology”

article-image

Executives weigh the growth potential they see in the public stock and private credit/equities arenas

article-image

Players can stake ME, trade tokens and link wallets to climb the leaderboard