However, whey Grayscale sells the underlying BTC to pay (themselves) this 2% fee, per grayscale, the investor (us) have to report that as a sale. That causes our portion of BTC ownership to decrease (even though our share of GBTC stays the same). Besides incurring an immediate realized capital gain(loss), that sale also causes a corresponding 2% decrease in our cost basis (which is calculated based on the remaining number of BTCs owned). So we get hit with a phantom unrealized capital gain of 2%, (assuming GBTC price stays flat throughout) on paper and without ability to deduct the expense? Something is very bad for investor.
