by Joseph Young
Trading volume in the shares of Grayscale Investment’s Bitcoin Investment Trust (GBTC) has hit a new all-time high, recording 71,697 shares or US$3.2 million in notional value in 24 hours.
Since its launch in May 2015, the Bitcoin Investment Trust has become the preferred method of qualified and established high- profile investors to purchase or sell bitcoins, primarily due to security concerns and price volatility.
One share of GBTC represents one tenth of a bitcoin, meaning it guarantees its buyers a certain number of bitcoins for the amount of shares they hold. Over the past few months, Bitcoin Investment Trust has become one of the most popular publicly traded bitcoin funds worldwide.
Amid the recent price spike, the price of the Bitcoin Investment Trust peaked at US$57 per share, surging by around 51% over the past 7 days.
According to the data chart provided by Nasdaq, the shares of Bitcoin Investment Trust peaked as the price of the bitcoin surpass the US$490 mark in international bitcoin exchanges including BitFinex, BitStamp and Kraken.
As shown in chart, the shares of Bitcoin Investment Trust began to surge on the 4th of November, around the time prominent bitcoin exchanges including Kraken, OKCoin and Huobi reported extreme DDoS attacks and server glitches.
Bitcoin experts often emphasize the danger of storing funds in an exchange. Most bitcoin exchanges, including Coinbase and Kraken, hold the private keys of their users accounts. Therefore, when a hacking incident occurs, the keys can become compromised and user accounts can be suspended indefinitely until the server issues are resolved.
During this time, users are not able to withdraw or deposit funds and must simply wait until the exchange recovers and continues its operations.
A similar incident occurred with Kraken and OKCoin users over the past few days. On November 4, as the price of the bitcoin began to surge, a series of heavy DDoS attacks were launched by unidentified groups of hackers against OKCoin and Kraken, taking the exchanges down for several hours.
Users were unable to sell the bitcoins as bitcoin reached its yearly high at US$501, and had to watch the price fall back to 400 without being able to move their funds.
Due to these reports, the number of investors purchasing the shares of the Bitcoin Investment Fund increased over the past few days, lending credibility to the fund as a reliable method for purchasing and selling BTC.