Grayscale hints at plans to convert Bitcoin trust into BTC-settled ETF

Grayscale, an institutional investment firm, is said to be considering the conversion of its Bitcoin Trust into an exchange-traded fund (ETF) that can be physically settled.

Barry Silbert (CEO of Grayscale’s parent company Digital Currency Group) hinted on Oct. 17 that Grayscale plans to convert its Bitcoin Trust into an instant-settled Bitcoin Fund.

After taking to Twitter to critique the U.S. Securities and Exchange Commission’s (SEC) approved cash-settled Bitcoin futures ETF, Preston Pysh, a Bitcoin commentator, asked Silbert when Grayscale’s Bitcoin Trust would become a BTC settled ETF. Silbert replied, “Stay tuned.”

Stay tuned
Barry Silbert (@BarrySilbert), October 17, 2021

Grayscale Bitcoin Trust investors seem to be uneasy about Silbert’s comments. A Twitter user, “svrgnindividual,” asked what a restructuring would mean for Grayscale’s Bitcoin Trust shareholders.

“What happens to Grayscale investors after the spot ETF approval? They tweeted, “Is our investment converted to ETF shares?”

Grayscale rumours began to circulate late last week, after an anonymous CNBC report claimed Grayscale was waiting for approval from the Securities and Exchange Commission for a Bitcoin ETF.

The SEC accepted registration of securities from ProShares Trust’s futures-based Bitcoin exchange-traded fund on Oct. 15. The ETF by ProShares gives investors exposure to future price speculation on Bitcoin (BTC) that is settled in cash.

Related:Grayscale Bitcoin Trust FUD has ended as the last GBTC unlock totals only 58 BTC

Although the ETF’s approval was cited as the main catalyst for Bitcoin’s bullish market action, many analysts have criticised the fund’s cash-settled structure. Instead, they advocated for the SEC’s approval of a Bitcoin ETF that is backed and settled in BTC.

Grayscale’s Oct. 15 holdings update shows that the company has $52.6 billion of assets under management (AUM). 73% of this amount is in the Bitcoin Trust. Grayscale’s Bitcoin stash is estimated to contain approximately 620,000 Bitcoins, or 3.3% of Bitcoin total supply.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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