Cryptocurrency funds could reap rewards from a new US Treasury strategic reserve that will be amassed by federal government seizure of Bitcoin and other cryptocurrencies as part of criminal or civil asset forfeiture proceedings. One I like is the Grayscale Bitcoin Trust (GBTC), advises Paul Dykewicz, editor of DividendInvestor.
Due to the fixed supply of Bitcoin, there is a strategic advantage to become one of the first nations to create a strategic bitcoin reserve, according to a March executive order to establish one. The Trump Administration believes the US must harness, not limit, the power of digital assets for the country’s prosperity.
Grayscale Bitcoin Trust (GBTC)
As for GBTC, it’s an open-ended trust launched and managed by the world’s biggest crypto asset manager, Grayscale Investments, LLC, to offer access to Bitcoin. GBTC invests through derivatives such as futures, swaps, and other Commodity Futures Trading Commission (CFTC)-regulated products.
GBTC tracks the performance of the TradeBlock XBX Index. It dominates other Bitcoin-focused funds and exchange-traded products (ETPs).
I recommended GBTC for the 2024 MoneyShow Top Pros Top Picks Report in late 2023 and it doubled during 2024, finishing as the second-best-performing investment suggested by any of the more than 40 market forecasters who contributed their top ideas. GBTC rose 137.3% during 2024, following a rise of 317.6% in 2023.
However, Bitcoin also has shown significant volatility, as GBTC fell 75% in 2022, after rising 7% in 2021, 290.7% in 2020, and 106.5% in 2019. As further proof there is no guaranteed appreciation, GBTC slid 82.1% in 2019.
That said, Trump’s support for Bitcoin and other cryptocurrencies could help boost their value in 2025.
Recommended Action: Buy GBTC
