Michael Sonnenshein, CEO of Grayscale Investments LLC, gave a virtual speech at the Crypto Summit on February 25, 2021.
Daniel Acker | Bloomberg | Getty Images
According to people familiar with the matter, Grayscale Investment plans to submit an application early next week to convert the world’s largest Bitcoin fund into a spot ETF.
The person said that once the agency allows competitors to make efforts for futures-based Bitcoin ETFs, the investment company intends to immediately submit an application to the US Securities and Exchange Commission. That happened later on Friday.
The source said that the grayscale application has begun a 75-day review period. The source declined to be named because the New York-based company has not disclosed its plans.
If approved, Grayscale’s ETF will be another step in the legalization of the nascent crypto asset class. Bitcoin has proven to be resilient, approaching an all-time high of more than $60,000 on Friday, even after experiencing setbacks including being banned by China last month.
The debut of the Bitcoin futures ETF is about to make its debut. Although it is significant, it is considered by some crypto investors to be an insufficient step because it will be linked to derivative contracts traded on the Chicago Mercantile Exchange instead of the actual Bitcoin.
However, the gray spot Bitcoin application represents an investment backed by Bitcoin, not a derivative related to it.
Grayscale owns a large portion of Bitcoin assets in the world because it is well known by the GBTC ticker symbol. As of Friday, GBTC managed US$38.7 billion in assets.
The company is a pioneer in crypto investment, enabling institutional investors such as Ark Invest’s Cathie Wood to bet on Bitcoin. The company initially publicly applied for an ETF in January 2017. After the US Securities and Exchange Commission stated that it had not applied, the company withdrew the application in October of the same year but was satisfied with the Bitcoin market.
Grayscale’s move may be to force the SEC to take action. According to sources, if they are satisfied with Bitcoin futures, then regulators should also be satisfied with the underlying market.
Of course, the SEC can still choose to delay or reject the grayscale application.
Last month, the CEO of Grayscale publicly criticized the SEC for its obvious preference for futures-based ETFs, calling them “short-sighted” measures that may harm investors’ interests.
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