Grayscale, a major player in digital asset management, has expressed excitement about the potential transformation of its Grayscale bitcoin Trust (GBTC) into a bitcoin ETF. This move could eliminate the current 8.09% discount to approximately $1.89 billion, more closely aligning the price of GBTC with the actual value of bitcoin, offering significant benefits to investors.
The company's chief legal officer, Craig Salm, and chief financial officer, Edward McGee, revealed the details. Pending approval from the United States Securities Exchange Commission, GBTC is set to transition its current platform, OTCQX, to the esteemed NYSE Arca exchange. This move seeks to better synchronize GBTC shares with the actual price of bitcoin and introduce a simplified mechanism for investors to effortlessly create or redeem shares.
Eric Balchunas, Bloomberg ETF Analyst observed the notable reliance on Regulation M (Reg M) relief. He references past conversations suggesting that the SEC could use Reg M to possibly prevent or postpone specific proceedings, although he stops short of stating this. Balchunas points out the intriguing moment Regulation M is mentioned immediately after Grayscale's meeting with the SEC, hinting at its possible importance or impact on their deliberations.
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With bitcoin (btc) currently priced at $39,481 and an increase in trading volume indicating increased trader interest, the prospect of a spot bitcoin ETF guarantees investors a more accurate representation of bitcoin's value over time. through GBTC and establishes a safer avenue for institutional investors to interact with bitcoin. . This development has already led to a 3% increase in the value of bitcoin in the last 24 hours, accompanied by a notable increase in trading volume, indicating widespread interest.
In a Nov. 28 X (formerly Twitter) post, Bloomberg ETF analyst James Seyffart said the SEC delayed its decision on the applications 34 days before the Jan. 1, 2024 decision deadline. Seyffart and his colleague Eric Balchunas had placed a 90% chance of spot approval of bitcoin ETFs by January 10, 2024, and the twin delays “pretty much confirm to me that this was probably a move to align all applicants for possible approval by January.” Deadline of December 10, 2024,” Seyffart said.
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