Grayscale Files for Bitcoin ETF Conversion
Grayscale Investments has made another filing with the securities regulator to convert its Grayscale Bitcoin Trust (GBTC) fund into a Bitcoin ETF. This move comes after the company’s chairman, Barry Silbert, stepped down from his position.
The filing indicates that Grayscale is accepting the SEC’s mandate on cash-only orders. It states that although the trust currently creates and redeems baskets only with bitcoins, it can now accept cash orders from authorized participants.
This amended S-3 filing is a regulatory requirement to issue new shares or convert existing securities into a different type.
Grayscale Prepares for ETF Competition
Grayscale’s strategic updates suggest that the company is preparing to compete with major players like BlackRock in the ETF market. These updates come ahead of the crucial approval deadline in January.
ETFs Can Disrupt Crypto Exchanges
Bloomberg’s senior analyst Eric Balchunas highlights that ETFs are disruptive due to their low-cost investment options. He dismisses fears that Bitcoin could disappear if ETFs were approved, comparing it to fear-mongering seen in the past with high-fee active managers and hedge funds.
Balchunas points out the significant difference in earnings between crypto exchanges and ETF markets, despite the former having less volume. He suggests that cost-effective ETFs could challenge the current profitable model of many crypto exchanges.
Hot Take: Grayscale Takes Steps Towards Bitcoin ETF Conversion
Grayscale Investments has filed for the conversion of its Grayscale Bitcoin Trust (GBTC) fund into a Bitcoin ETF. This move aligns with the SEC’s mandate on cash-only orders and positions Grayscale for competition in the ETF market. The approval of Bitcoin ETFs could disrupt the crypto exchange industry by offering low-cost investment options and potentially challenging the profitability of exchanges. Grayscale’s strategic updates indicate their readiness to compete with major players like BlackRock. The deadline for approval is set for January, and the outcome will have significant implications for the future of Bitcoin and the broader cryptocurrency market.
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