Overwhelming support for Grayscale BTC Trust ETF conversion proposal
The U.S. Securities and Exchange Commission has allowed comments and feedback on a proposed rule change that would convert Grayscale’s Bitcoin Trust to a spot-based exchange-traded fund (ETF).
A notice of filing a proposed rule change to list and trade shares of Grayscale Bitcoin Trust as a spot-based ETF has generated a long list of comments with a large majority in approval.
Bloomberg’s senior ETF analyst Eric Balchunas had a look through some of the more recent comments on Feb. 15 observing that 95% are in favor of the proposed conversion.
Just glancing through the many comments from ppl to the SEC re converting $GBTC to an ETF and 95% are in favor of it and most using real names and pointing to the stupefying fact that futures ETF ok but spot not. eg: pic.twitter.com/j15iNYnh8R
Several respondents to the SEC proposal argued that the regulator had already approved futures-based exchange-traded products so a spot-based product should logically come next. The U.S. risks falling behind other countries such as Canada which has already approved such investment products, others added.
A spot-based fund would be physically backed by the asset itself as opposed to backing by futures contracts from the Chicago Mercantile Exchange (CME) which is how existing Bitcoin ETFs operate.
Another comment pointed out that the current fund creates arbitrage opportunities that can take advantage of retail traders.
Grayscale’s Bitcoin Trust has been trading at a massive discount in recent months as investors speculate and hedge on the ETF being approved by the SEC. At the time of writing, the fund was trading at a discount of 24.75% according to Ycharts. This means that with BTC currently priced at around $43,600, the discounted fund price would
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