Grayscale Renews Bitcoin ETF Request Following Barry Silbert’s Resignation
Grayscale, the cryptocurrency manager, has submitted an updated version of its S-3 document to the US Securities and Exchange Commission (SEC) after Barry Silbert resigned from the board of directors. Mark Shifke, the Chief Financial Officer of Digital Currency Group, has taken Silbert’s place as Chairman of the Board of Grayscale. This change prompted Grayscale to comply with the cash-only creation model required by the SEC. Observers believe that Silbert’s departure could increase the chances of approval for the Grayscale Bitcoin Trust (GBTC) to become a spot ETF on Bitcoin.
The Liquidity Creation Model and Bitcoin ETFs
In addition to Silbert’s resignation, the modified S-3 document acknowledges that Grayscale has accepted a liquidity creation model. This is a significant agreement between asset managers and the SEC since most ETFs use in-kind models. The liquidity creation model allows new shares of a spot Bitcoin ETF to be created or redeemed only through cash transactions. The SEC’s decision to limit direct trading with Bitcoin aims to improve traceability and mitigate risks related to anti-money laundering and KYC regulations. However, some experts believe that this model poses a greater risk for investors seeking exposure to Bitcoin through an ETF.
Possible Approval of the Spot ETF and Expert Considerations
The approval of the first US Bitcoin spot ETF is highly anticipated by investors in the cryptocurrency market. BTC’s price has been on the rise in 2023, reaching levels not seen since April 2022. Discussions between the SEC and asset managers have focused on technical details, indicating a potential imminent approval according to industry experts. If approved, multiple ETF quotes could be listed on the same day due to similar approaches from issuers. While there is growing optimism, experts warn that the price of Bitcoin could fluctuate due to investors selling to cash in their profits. Investors are advised to carefully assess their risk tolerance and objectives before investing in the Spot BTC ETF.
Hot Take: Grayscale Renews Bitcoin ETF Request Following Barry Silbert’s Resignation
Grayscale has submitted an updated document to the SEC for a Bitcoin ETF spot following the resignation of Barry Silbert. This change, along with the acceptance of a liquidity creation model, may increase the chances of approval for the Grayscale Bitcoin Trust to become an ETF. The approval of a Bitcoin spot ETF is eagerly anticipated by investors, as it represents a significant milestone in the cryptocurrency market. While there is optimism surrounding the approval, experts warn of potential price fluctuations and advise investors to carefully assess their risk tolerance before investing. Overall, this development showcases the ongoing efforts to bring more accessibility and legitimacy to the world of cryptocurrencies.
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