Key Takeaways
- Grayscale has moved for the conversion of GBTC to an Exchange-Traded fund.
- The application is coming following the approval of ProShare ETF by the United States Security and Exchange Commission (SEC).
- There are more than twelve applications before the SEC waiting for approval currently.
Grayscale is reported to be moving to convert the Organization's Bitcoin Trust to an Exchange Traded fund Supported by physical BTC.
A required application with the United States Security and Exchange Commission is expected to be submitted this week, as per news from CNBC.
This week, the company held about $52.6 billion worth of assets under management, with about 73% of the total funds assigned to the Grayscale Bitcoin Trust (GBTC).
However, this trust has some demerits like six months of lock up on the assets and a 2% yearly fee.
The fund has also been selling Bitcoin to people since the second month of this year, as at the time of putting this down, the GBTC discount stands at 15.5%.
Following the SEC’s approval of ProShare Trust's future-based ETF last week, Grayscale also decided to file for a spot ETF immediately.
According to an undisclosed source related to the matter, the firm's action could be a trial to leave the SEC with no option other than to approve the application.
The approval of the ProShare Exchange Traded fund by the SEC is considered to be the main reason for the Bitcoin rapid increase to hit a value of more than $62k.
Nevertheless, many investors still have doubts concerning the Bitcoin prospective product.
Contrary to futures Bitcoin ETFs, which are linked to the CME-traded derivatives contracts, an acceptable BTC ETF is supported by the real underlying assets.
Charges on Future BTC ETF are also reported to be too high. Matt Hougan explained that the products could have a charge of about 6-12%.
Presently, there are more than twelve applications for the BTC Exchange-Traded fund before the US Security and Economic Commission.
The recent application came from Bitwise Asset Management which was filed last week.
The Digital Currency Group boss, Barry Silbert, is also one of the people who do not support Future ETFs.He recently advised people not to buy or hold the Future-based ETFs in his recent tweet.
GBTC's move to convert the trust into an ETF is not coming as a surprise as the firm has once disclosed its plan of taking this action a few months ago,
The organization is completely determined to transform the GBTC into an ETF and the time for the action will be determined by the regulatory setting.
Do you think the application to turn the GBTC into an ETF will be approved by the SEC?
