Grayscale’s CEO, Michael Sonnenshein, is urging the US Securities and Exchange Commission (SEC) to permit the approval of multiple spot-Bitcoin ETFs simultaneously. According to Sonnenshein, such a move is crucial to ensure an equitable environment for all market participants, including Grayscale Bitcoin Trust (GBTC) investors. In an interview with Bloomberg TV on Monday, he emphasized the need for the SEC to greenlight various spot-Bitcoin ETFs concurrently.
“I think that the SEC should and does, in fact, want to create an even playing field,” Sonnenshein stated. “We’ve publicly been advocates of the fact that when the commission is ready to give the requisite approvals for spot products to come to market, that it should be done all at once — the issuers who are operationally ready to launch their products should come out the gate all at once.”
Grayscale is prepared to list GBTC as an ETF and has expressed a commitment to reducing its fee once it begins trading as such. The current expense ratio for the trust stands at 2%.
Earlier this year, Grayscale achieved a significant victory against the SEC in its effort to convert its trust into an ETF. However, as more than 10 companies vie for approval to launch spot-Bitcoin ETFs, analysts are speculating about which ones will have the advantage of being the first to attract investor interest and capital.
Sonnenshein emphasized the potential disadvantage to GBTC investors if the SEC does not allow simultaneous ETF launches. He stated, “It would put them in a terrible spot if they were to disadvantage the hundreds of thousands of investors in GBTC thinking about other products coming to market before it.”
The race for a Bitcoin exchange-traded fund, ongoing for over a decade, may see resolution in the next few weeks, particularly around a key deadline in early January. This deadline involves regulatory decisions on applications from ARK and 21Shares, and if approved, it could set a precedent for other applicants.
A current challenge for issuers revolves around in-kind versus cash redemptions for ETFs, a distinguishing feature of these investment vehicles. In-kind redemptions involve exchanging the fund’s underlying securities with a market maker, while cash redemptions involve selling the securities to distribute cash to redeeming shareholders. Sonnenshein highlighted Grayscale’s preference for in-kind redemptions, emphasizing the model’s effectiveness in protecting investors, ensuring liquidity, and creating a positive investor experience.
As the cryptocurrency market navigates this pivotal moment, market participants await regulatory decisions that will shape the landscape of Bitcoin ETFs and influence investor strategies.
