Grayscale announced its readiness to transition its Bitcoin Trust (GBTC) into an exchange-traded fund (ETF) upon the US Securities and Exchange Commission (SEC) approval
Grayscale made this statement after the SEC chose not to appeal a court ruling that compelled the regulatory body to review the crypto asset manager’s request to convert GBTC into an ETF.
Within the next seven days, the court will issue the final mandate, following the expiration of the SEC’s 45-day appeal window. The company emphasized its preparedness to convert GBTC into an ETF upon SEC approval.
Journalist Eleanor Terrett from Fox Business was the first to share the statement.
GBTC, the largest Bitcoin investment product, was the subject of a lawsuit filed by Grayscale against the SEC’s decision to block its spot Bitcoin ETF application. Grayscale argued that the ETF would benefit investors and enable redemptions for the trust.
The value of GBTC shares is lower than that of the underlying Bitcoin because investors cannot redeem their shares for the underlying cryptocurrency. According to data from Coinglass as of October 13, the discount has narrowed to a low of 15.88% for the year.
Analysts believe that the discount on GBTC shares could decrease if the trust converts into a spot Bitcoin ETF, allowing investors to gain exposure to the cryptocurrency without direct ownership.
The financial regulator has frequently maintained that applicants for spot Bitcoin ETFs lack adequate safeguards against market manipulation.
Despite multiple applications from top investment firms, including BlackRock, the SEC has not approved a spot Bitcoin ETF in the past decade.
Some analysts speculate that the SEC’s stance on spot Bitcoin ETFs may be shifting, with Bloomberg ETF analysts recently estimating a 90% chance of approval.
Analysts believe that the SEC’s increased engagement with fund sponsors indicates a greater willingness to approve a spot Bitcoin ETF.
“This back-and-forth between the SEC and fund sponsors is standard practice for new launches but a first for spot Bitcoin ETF applications,” they wrote.
On Monday, October 16, Bitcoin rose by 4%, reaching $28,000, as expectations of a spot Bitcoin ETF in the US increased.
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