Grayscale Bitcoin Trust's (GBTC) shares have widened their discount relative to the underlying cryptocurrency held in the fund, reaching a record of 26.5% on Wednesday.

GBTC has been the preferred venue for institutional investors to gain exposure to crypto without having to purchase bitcoin directly, but the shares have traded at a steep discount over the past year as demand for the product shrank. (Grayscale Investments, which manages the trust, is a unit of Digital Currency Group, which also owns CoinDesk.)

The premium flipped to a discount last February, and the discount has steadily widened ever since due to several factors, including the launch of spot-based exchange-traded funds (ETFs) in Canada, which provided an alternative to those looking to invest in bitcoin through a stock market vehicle.

The persistent discount could also be due to investor skepticism regarding Grayscale's plan to convert the fund into a spot-based ETF. Some analysts don't expect a conversion anytime soon, and in the meantime, investors are getting charged fees.

The U.S. Securities and Exchange Commission hasn't approved a spot bitcoin ETF.

"There's still no way for bitcoin to ever leave GBTC, which means it should continue to trade with a substantial discount to reflect that illiquidity," Dave Nadig, director of research and chief investment officer at, wrote in an email to CoinDesk.

The recent crypto sell-off also may have contributed to a wider GBTC discount. Bitcoin is down roughly 37% from its all-time high of nearly $69,000 in November, although the cryptocurrency's price appears to be stabilizing at about $42,000 at the time of writing.

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