Grayscale in talks with SEC over details of Bitcoin ETF

Grayscale recently held a discussion session with the SEC to examine aspects related to the Bitcoin-based Exchange Traded Fund (ETF). 

In the meeting, Grayscale executives and lawyers explored the possibility of making rule changes to allow the Grayscale Bitcoin Trust (GBTC) to be priced. See below for full details. 

Grayscale executives work with SEC to list Bitcoin ETF

As anticipated, executives from cryptocurrency manager Grayscale recently attended a meeting with the Securities and Exchange Commission (SEC) to go over the details of their main Bitcoin trust. 

As a reminder, the company is pursuing the goal of converting this trust into a spot Exchange-Traded Fund (ETF) on Bitcoin.

According to an SEC memo dated 20 November, executives including CEO Michael Sonnenshein, chief legal officer Craig Salm and ETF head Dave LaValle, along with legal representatives from Davis Polk, met with the SEC’s Division of Trading and Markets. 

Discussions focused on proposed rule changes submitted by NYSE Arca, Inc. to list and trade shares of the Grayscale Bitcoin Trust (BTC) in accordance with NYSE Arca Rule 8.201-E.

In addition, Grayscale announced that it has signed a transfer agency and service agreement with BNY Mellon. This bank will act as agent for the Grayscale Bitcoin Trust (GBTC), facilitating the issuance and redemption of shares and managing shareholder accounts.

Analysts optimistic about future of GBTC price on NYSE Arca

Bloomberg ETF analyst James Seyffart pointed out that the SEC’s Trading and Markets Division is responsible for approving or denying 19b-4s, the form used to inform the SEC of a proposed rule change by a self-regulatory organization.

In addition, ETF Store President Nate Geraci pointed out that the term “uplisting” was used to define the ‘conversion’ of GBTC, stressing that it does not indicate any problem with conversion to ETFs. 

Geraci suggested that Grayscale could dominate the ETF category if it succeeds in listing GBTC on NYSE Arca at the same time as other issuers launching spot ETFs on BTC, competing effectively on fees.

Recall that Grayscale filed a Form S-3 registration statement with the SEC in October, expressing its intention to list GBTC’s shares on NYSE Arca under the symbol GBTC.

Meanwhile, a US appeals court has ordered the SEC to review its decision to reject Grayscale’s bid to convert GBTC into a spot ETF. 

Grayscale, as we know, is competing with other major asset managers, including BlackRock and Fidelity, for approval of spot ETFs on Bitcoin at the SEC. 

Seyffart pointed out that the odds of approval appear to remain stable, with an estimated 90% chance of an ETF being approved by 10 January 2024.

Grayscale’s analysis of Javier Milei’s election in Argentina 

The recent ascension of libertarian leader Javier Milei to Argentina’s presidency could trigger a significant change in the country’s approach to cryptocurrencies, according to an analysis by Grayscale. 

In particular, Javier Milei’s bold proposals to reform monetary policy and even close Argentina’s Central Bank are paving the way for potential consequences in the mainstream financial and cryptocurrency spheres.

In fact, we see that since Milei’s triumph in the leadership race in South America’s second largest economy, the value of Bitcoin has peaked in over a year and a half, standing at nearly $38,000. 

Indeed, we emphasize that the politician’s unique vision of using Bitcoin as a “return of money to the private sector” could redefine Argentina’s economic landscape.