Grayscale Bitcoin Trust (BTC) (OTCMKTS: GBTC) has started breaking out in response to a bullish momentum that has engulfed the cryptocurrency sector. After a rollercoaster 2018 that saw the stock shed more than 80% in market value, the stock has started powering higher if recent price action activity is anything to go by.
GBTC Catalysts And Share Price Analysis
Bitcoin rallying past the $4,000 technical level has helped reinvigorate investor sentiments after imploding in 2018. With the spike, so are cryptocurrency stocks showing signs of bouncing back as investors stream back into the sector.
A spike in Bitcoin price is always good for Grayscale Investments’ as it remains the most dominant digital currency for the company’s investors. In addition, the company’s sentiments have inched higher on the digital currency manager raising $360 million in 2018.
The stock is already up by more than 30% for the year as it continues to trade in a steep uptrend. A breach of the $5 a share resistance level has opened the door for the stock to continue powering high as part of the emerging uptrend.
Above the $5 technical level, Grayscale Investments remains well positioned to make a run for the $7 a share mark, the immediate resistance level. For the stock to turn bullish after the underperformance of last year, it needs to rise and stabilize above the $10 a share level.
A violation of the $5 a share support level on pullbacks could accelerate a sell-off of the stock, in continuation of the long-term bear trend.
What Does Grayscale Investments Do?
Grayscale Investments casts itself as a world’s largest digital currency asset, Management Company. The company strives to provide investors tools for making informed decisions when it comes to investment opportunities in the cryptocurrency sector. The company has also removed the barrier of entry and built an array of investment products.
Cryptocurrencies Bounce Back
Grayscale Investments impressive run in recent months has everything to do with renewed investor interests about opportunities in the cannabis sector. Major Cryptocurrencies have bottomed out after coming under pressure in 2018.
Bitcoin rallying past the $4000 technical level has opened a window of opportunity for people to pursue investment opportunities in the multi-billion sector. The flagship cryptocurrency being the most dominant digital currency for Grayscale investors explains why the stock has started picking up some steam.
The company remains well positioned to generate significant value as cryptocurrencies continue to bounce back. Considering that Grayscale Investment raised $359.5 million from its diversified investment products at a time when cryptocurrencies were trending lower, provides a glimpse of what could turn out to be an impressive year.
In 2018, the company raised more capital than it did at the peak of the crypto boom in 2017.
“Bitcoin continued to be the most dominant digital currency for Grayscale investors. In the fourth quarter, 88% of all capital inflows went into Grayscale Bitcoin Trust™ (OTCQX: GBTC). Throughout 2018, Bitcoin accounted for $242 million of the capital raised from Grayscale investors,” Grayscale Investments in a statement.
Diversified Investment Products
Grayscale Investments offers nine single-asset investment products that provide exposure to an array of cryptocurrencies such as Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH) Stellar Lumens (XLM) and Litecoin (LTC). All the investment products are available to both institutional and accredited individual investors.
The company has since expanded its product line as it seeks to target more institutional investors. Early in the year, the digital asset manager unveiled Stellar Lumens Trust, a single asset investment product designed to offer exposure to Lumens.
“We are pleased to bring Grayscale Stellar Lumens Trust to market and will continue to provide investors access to established blockchain projects with substantial traction and resources. Grayscale has established a leadership role in this emerging industry, and the launch of this product will expand our coverage of the digital asset universe,” said Michael Sonnenshein, Managing Director of Grayscale.
What Next For Grayscale Bitcoin Trust
Grayscale Investments sentiments and prospects are slowly inching higher as the broader cryptocurrency sector turns bullish. The company remains well positioned to benefit as investors eye undervalued opportunities in the sector.
A diversified portfolio of digital asset investment products leaves the company in a strategic position ideal for attracting institutional investors.
That said the stock looks set to continue powering higher in line with the bullish momentum in the overall cryptocurrency sector.
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Disclosure: We have no position in GBTC and have not been compensated for this article.