- Grayscale formally started the paperwork for converting Grayscale Bitcoin Trust (GBTC) into a Bitcoin spot ETF.
- The GBTC fund boasts $40 billion worth of assets under management.
- The BTC/USD pair rallied towards $64,000.
KOLKATA (CoinChapter.com) – Grayscale formally entered the Bitcoin ETF race on Tuesday. The firm applied with the US Securities and Exchange Commission (SEC) to convert Grayscale Bitcoin Trust (GBTC) into a Bitcoin spot ETF. Bitcoin rallied and tapped $64,000 in response.
“Grayscale and @NYSE formally kicked off the process this morning to convert $GBTC into the first spot-based bitcoin ETF Upon conversion, the Grayscale Bitcoin Trust will trade under the ticker symbol $BTC.”Barry Silbert, Founder/CEO of Grayscale’s parent firm Digital Currency Group said
GBTC is the world’s largest Bitcoin investment vehicle with more than $40 billion worth of assets under management (AUM). It is a significant milestone for Grayscale, especially after the leading crypto asset management firm onboarded the Bank of New York Mellon (BNY) as an asset servicing provider for GBTC.
ETF Backed By Physical Bitcoin
Through its ETF application, Grayscale moved away from the futures-linked Bitcoin ETF model. Rather the GBTC BTC spot ETF, if approved, would be backed by physical units of the top cryptocurrency. Unlike the ProShares Bitcoin Futures ETF, which recently received the SEC’s go-ahead and is already trading on the NYSE.
“At Grayscale, we believe that if regulators are comfortable with ETFs that hold futures of a given asset, they should also be comfortable with ETFs that offer exposure to the spot price of that same asset.”noted Dave LaValle, Global Head of ETFs at Grayscale Investments
The top Grayscale executive also observed the strong demand for GBTC. He assured that the GBTC Bitcoin ETF is akin to “folding Bitcoin into the familiar protections of an ETF wrapper, and ultimately providing investors with a choice in how they want to allocate their Bitcoin exposure.”
BTC/USD Nears $64,000
Grayscale’s ETF filing announcement coincided with the benchmark cryptocurrency’s rally towards $64,000. The BTC/USD pair inched up 4% from lows near $61,343 to $63,755. Bullish sentiment is strong, as seen from the upwards ticking relative strength index (RSI) indicator.
The moving average convergence divergence (MACD) wave is also about to flip bullish with the blue wave crossing over the red wave. Buyers seem resolute to push Bitcoin above the previous all-time high of $65,000. A scenario that is entirely possible given the current market conditions.
Bitcoin will enter a price discovery mode after surpassing its previous ATH, with the next probable high falling near $67,300. Above it, $70,000 will shape up as the next psychological top.