Grayscale Investments continues the conversion of their digital currency investment to exchange traded funds with the announcement in a press release of NYSE Arca’s filing with the SEC to convert their flagship Grayscale Bitcoin Trust (GBTC) into an ETF.
Grayscale is the biggest global digital currency asset manager, and GBTC is the largest bitcoin trust worldwide, holding roughly 3.44% of all bitcoin currently in circulation and with approximately $40 billion in assets under management. The 19b-4 filing was done by NYSE Arca and would convert the existing fund into a bitcoin spot ETF linked directly to the largest cryptocurrency.
“In becoming the first crypto SEC reporting investment vehicle, GBTC has helped move the entire digital currency ecosystem forward,” said Michael Sonnenshein, CEO of Grayscale Investments, in the press release. “As we file to convert GBTC into an ETF, the natural next step in the product’s evolution, we recognize this as an important moment for our investors, our industry partners, and all those who realize the potential of digital currencies to transform our future.”
Markets are abuzz with the debut of the ProShares Bitcoin Strategy ETF (BITO), the first cryptocurrency-related ETF to be approved by the SEC. This fund trades in bitcoin futures, with no direct exposure to bitcoin itself. With this approval, Grayscale is filing in the hopes that if the Commission has given the go-ahead on futures, they could also be okay with the underlying market itself.
“At Grayscale, we believe that if regulators are comfortable with ETFs that hold futures of a given asset, they should also be comfortable with ETFs that offer exposure to the spot price of that same asset,” said Dave LaValle, global head of ETFs at Grayscale Investments. “GBTC proves that there’s strong investor demand for physically-backed Bitcoin investment vehicles.”
The filing begins a 75-day review cycle before the SEC, and if approved, current owners of GBTC would see their shares automatically converted to shares of the ETF, according to a note to ETF Trends from Vested, a financial communications agency.
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