Grayscale is a digital investments company that places funds on public stock exchanges by inviting a group of wealthy investors to contribute to the fund. An ETF is an exchange-traded fund that mimics the price value of a real-world asset. The Bitcoin ETF is set to mimic the value of a real price value asset. Hence, Grayscale to apply for Bitcoin ETF is the focus of this article.
Grayscale and Bitcoin ETF
A Bitcoin ETF is no longer a matter of “if ” but is now an issue of a “when” since Grayscale happened. Grayscale has the largest Bitcoin Trust fund globally, the Grayscale Bitcoin Trust (GBTC), worth $37.8 billion. The fund manages the assets of investors globally. One such fund that has bought into the ETF already is ‘Cathie Wood’s Ark.’ Adding onto the assets; the company is embracing new cryptocurrency technologies such as DeFi, which help to expand its cryptocurrency offering. Some of the tokens GrayScale has added are Sol, and it also uses DEXs such as Uniswap to help users access its token funds.
Grayscale to Apply for Bitcoin ETF
The company intends to file an application with the Securities Exchange Commission (SEC) that allows for the conversion of the Bitcoin fund to a spot ETF. As per the interview from CNBC on Friday, Bitcoin will act as a backing for the ETF. The first bitcoin features ETF is set for trading this week, following an approval. Unlike other bitcoin futures, the ETF will also have no derivatives attached to it.
Gary Gensler, the SEC chairman, showed excitement during the interview on allowing for a bitcoin-based ETF. Gensler commented that digital currencies are changing society but need more regulation before acceptance as ETFs. However, the excitement for the crypto ETF left many simply waiting for the approval of the GBTC ETF. Sec only waits for transparency and maturity of the crypto space, something slowly establishing.
Reasons for a Bitcoin ETF
- The supply of Bitcoin is limited, which will make it a scarce value asset like gold. For example, you might want gold, but it is scarce. Therefore users trade a digital representation of gold, for this case, a digital representation of Bitcoin, because you do not want to hold Bitcoin.
- Security of funds traded.
- To allow traditional investors to own indices of bitcoin.
Bitcoin ETF Approval?
SEC recently approved a BTC fund by ProShares. This is a clear indication that the exchange is beginning to trust the cryptocurrency markets, especially Bitcoin. This is a step towards the right direction, which leaves Grayscale hopeful, considering the fund has no derivatives.
Grayscale Bitcoin Fund
It is inspiring to see large companies interested in cryptocurrency, especially the investment and stock-trading companies. Grayscale is a large company, and it will have a huge impact in the crypto world by launching the ETF. I will mean the SEC has come to acceptance with the reality that cryptocurrencies are here to stay and are the currency of the future. We all are looking forward to the ETFs approval.