Bitcoin ETF in Limbo
Michael Sonnenshein, Grayscale’s CEO, finds himself in a maze of uncertainty regarding the firm’s Bitcoin ETF conversion. Despite Grayscale’s recent court victory over the Securities and Exchange Commission (SEC), questions linger.
As Sonnenshein explained to Bloomberg, the final decision hinges on the court’s mandate. The definitive opinion is anticipated within 45 days from the ruling. Yet, even with the court’s decision, a straightforward path to launching a Bitcoin ETF remains elusive, especially with the SEC’s historic hesitancy on the matter.
Industry and Regulator Responses
The recent ruling is seen by many as a rebuke to the SEC. But it doesn’t necessarily translate into a green light for Grayscale’s Bitcoin ETF. The SEC’s history of delays and resistance towards the crypto industry might persist.
Both the SEC and Grayscale have voiced their intentions to review the decision in depth. While awaiting further communication from the SEC, Sonnenshein remains optimistic, highlighting that there should be no additional roadblocks to market such products.
In a promising note for potential investors, Grayscale has pledged to lower its fees upon converting GBTC to an ETF, aiming for a structure more in line with typical ETFs.
GBTC Discount Diminishing
One significant market indicator post-ruling is the narrowing GBTC discount. Historically, the discount or premium illustrates the difference between the fund’s net asset value and the market value of the asset. The recent court decision has brought the GBTC discount down from a staggering -50% in December 2022 to a modest -18% now, as reported by Ycharts.
However, James Seyffart, Bloomberg Intelligence ETF analyst, opines that the discount will likely remain until the official conversion occurs. Seyffart’s team now sees a 75% likelihood of a Bitcoin ETF getting the green light this year.
With the court’s ruling echoing in the industry corridors and a watchful eye on the SEC’s next move, the future of Grayscale’s Bitcoin ETF conversion remains one of the most keenly watched events in the crypto world.