Grayscale Bitcoin Fund in Emerald Mutual Holdings

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In Brief
  • Emerald Mutual reported to the SEC on owning more than 78,000 shares of Grayscale Bitcoin Trust.

  • Insitutional and enterprise investors are a main driver of the 2020-2021 bull run.

  • Grayscale offers institutional investors an onramp for accessing bitcoin.

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The Trust Project is an international consortium of news organizations building standards of transparency.

The mutual fund’s regulatory filing shows that it has joined the surge in institutional investment into BTC through Grayscale Bitcoin Trust (GBTC).

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 Emerald Mutual Fund Advisors Trust filed with the Securities and Exchange Commission (SEC) on Jan. 29 for December 2020. Holdings include 78,090 shares of Grayscale Bitcoin Trust (GBTC). 

Twitter user MacroScope17 noted the filing and pointed out that Emerald Mutual Fund also managed $4.7 billion in September 2020. At current BTC prices and one GBTC share equaling under 0.001 BTC, the GBT holding equals approximately $2 million, or 0.5% of Emerald’s assets under management in September.

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Other Filings

MacroScope17 also pointed out that Hellman Jordan Management reported owning 63,355 shares of GBT. Kingfisher Capital also filed with the SEC, and reported on owning 10,667 shares of GBT.

The entry of institutional investors is considered to be the main driver behind the bitcoin rally of 2020. Retail investors made their case at times, such as during the year-end push that brought bitcoin to $35,000. Overall, however, the headlines belong to institutional investors such as MassMutual.

Enter the Enterprises

Enterprise investors such as MicroSystems, which buy bitcoin to replace cash in their corporate treasuries, are an upcoming feature of the current environment. MicroSystems CEO Michael Saylor stated that in February 2021, the company would share its corporate game book for purchasing bitcoin. 

Companies following MicroSystems’ lead would be able to replace cash in their treasuries without having to feel their way through the legal jungle. By releasing the game book, MicroSystems helps generate enterprise demand, and thus buoy the state of its own reserves.
 Companies such as PayPal, which buy bitcoin to make them available to retail clients are a third leg supporting demand. PayPal alone purchased about 70% of the bitcoin mined per month, according to Pantera Capital in November.

There’s Whales, and There’s Grayscale

Of the larger institutional purchasers on the market, none make waves as does Grayscale. The company’s entry into the market in 2020 realized HODLers’ dreams of institutional involvement. Grayscale’s need for bitcoin is an indication that institutional investors, who for regulatory reasons find it easier to hold crypto indirectly, are gaining interest in the asset. It’s purchases on the market are large in volume, and not just in USD terms: on Jan. 19, the company purchased 16,244 BTC, just days after buying more than 4700 BTC over 48 hours.

Grayscale is the best known bitcoin conduit for institutional investors at this time. However, it is not the only one. Massachusetts Mutual invested $100 million into bitcoin through NYDIG (formerly New York Digital Investment Group). 

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James Hydzik is a finance and technology writer and editor based in Kyiv, Ukraine. He is especially interested in the development of regulation in the face of increasingly rapid technological change. He previously covered the CEE region for Financial Times banking and FDI magazines. An ardent believer in gut renovating eastern Europe one flat at a time, he currently holds more home renovation gear than crypto.

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