The American digital currency asset management company, Grayscale Investments, intensified the hype surrounding the spot Bitcoin exchange-traded fund (ETF) filings in its latest post. It stated that the highly anticipated approval of the crypto investment vehicle is simply “a matter of ‘when,’ not a matter of ‘if.'”
Despite the uncertain timelines for the approval of spot Bitcoin ETF filings, Grayscale emphasized that it remains “focused on uplisting GBTC to NYSE Arca as a spot Bitcoin ETF.”
In its update, Grayscale Investments Chief Legal Officer Craig Salm and Chief Financial Officer Edward McGee discussed the potential transformation of the Grayscale Bitcoin Trust (GBTC) into a Bitcoin ETF, or its eventual uplisting in the New York Stock Exchange (NYSE) as an exchange-traded fund, which according to the executive, could eliminate the current 8.09% discount or around $1.89 billion, allowing the price of GBTC to align more closely with the actual value of Bitcoin.
“Importantly, in an ETF format, shares of GBTC are expected to more closely track the price of Bitcoin, which means that any premium or discount on GBTC’s share price is expected to disappear.” McGee explained, before saying, “This means that upon GBTC uplisting to NYSE Arca and becoming an ETF, approximately $1.89B of value would be unlocked for investors through the arbitrage mechanism, assuming the current discount disappears.”
Moreover, GBTC as a Bitcoin ETF, will allow investors to use an arbitrage mechanism that would enable shares to be continuously created or redeemed.
“The innovation of the ETF product structure is that it has the arbitrage mechanism, which allows shares to be continuously created or redeemed to address premiums and discounts,” Salm explained.
As for the timeline, Grayscale Investments’ chief legal officer said it is still uncertain although he assured that the team is working with the SEC to uplist GBTC to NYSE Arca.
“Unfortunately, no. Though the DC Circuit ruled in favor of Grayscale in our lawsuit against the SEC in August 2023, vacating the SEC’s decision to deny NYSE’s 19b-4 application to uplist GBTC to NYSE Arca. This is an unprecedented situation and timelines are inherently uncertain. The Grayscale team is committed to working constructively with the SEC to uplist GBTC to NYSE Arca, and will continue to share timely updates as additional information becomes available,” Salm said.
Bloomberg Intelligence ETF analyst James Seyffart recently predicted that the SEC might decide on pending spot Bitcoin ETF applications between Jan. 8 and 10 next year.
“Window is officially Jan. 5 to Jan. 10. Really, this means that any potential approval orders are going to come on either Monday Jan. 8, Tuesday Jan 9, or Wednesday Jan 10. Mark your calendars people,” Seyffart’s tweet read.
Window is officially Jan 5th to Jan 10th. Really this means that any potential approval orders are going to come on either Monday Jan 8, Tuesday Jan 9, or Wednesday Jan 10. Mark your calendars people. https://t.co/8ob8Y6pgU5
— James Seyffart (@JSeyff) December 1, 2023
Bitcoin was trading in the green zone at $41,281.08 as of 11:45 a.m. ET on Monday with a 24-hour trading volume up by 108.91% at $35.63 billion.
BTC’s price action represented a 4.10% increase in the past 24 hours and a 12.6% gain over the last seven days.
Data from CoinMarketCap showed that Bitcoin’s circulating supply stands at 19.56 million as its value continues to climb by 4.10% at a $$808.73 billion market cap.
