Grayscale, the sponsor of Grayscale Bitcoin Trust (GBTC), the largest Bitcoin
fund, said in early April that it is “100%
committed to converting GBTC to an
ETF,” but “the timing will be driven by
the regulatory environment.”
To date, the Securities and Exchange
Commission has not approved any
Bitcoin or other cryptocurrency ETF,
though several applications are pend-
ing before the agency, and three Bitcoin
ETFs are trading on the Toronto Stock
Exchange in Canada and available only
A sponsor of one of those ETFs, CIGlobal Asset Management, has justlaunched a Bitcoin mutual fund inCanada, also available only in Canada.The fund, called the CI Galaxy BitcoinFund, will invest “all or substantiallyall of its assets in the CI Galaxy BitcoinETF,” with which it intends to mergelater this year. The subadvisor for theETF and the fund is Galaxy DigitalFund Management.
Grayscale first filed an applicationwith the SEC for a Bitcoin ETF in 2016but ultimately withdrew its applicationfollowing discussions with the SEC thatlasted “the better part of 2017,” according to Grayscale’s announcement.Firms typically withdraw applicationsthat are facing rejection at the SEC,which is what several firms have done,though at least one of those firms, VanEck, followed up with a new BitcoinETF application.
“While several firms have submitted
Bitcoin ETF applications in the form
of an S- 1 or 19b- 4 to the SEC, we are
confident in our current positioning
and engagement with the SEC,” said
Grayscale, referring to SEC forms that
public companies must file when listing
new securities and that exchanges must
file to list those securities.
The firm said when GBTC, which has$34 billion in assets, is converted into anETF, investors owning publicly tradedGBTC shares will automatically receive
FIDELITY FILES FOR BITCOIN ETF
Fidelity Investments, one of the firstasset managers to engage with cryptocurrencies, also has filed an applicationwith the SEC to launch a Bitcoin ETF.
According to the filing, the WiseOrigin Bitcoin Trust would track theperformance of Bitcoin as measured bythe Fidelity Bitcoin Index PR, whichcontinually updates Bitcoin pricesthroughout the day based on feedsfrom multiple spot markets and a vol-ume-weighted median price methodology. Fidelity Digital Assets Services,which launched in late 2018, wouldserve as custodian.
Fidelity already has introducedthe Wise Origin Bitcoin Index FundI, which is available only to qualifiedinvestors and requires a minimum$100,000 investment.
In a statement released following itsBitcoin ETF filing Fidelity said: “Thedigital ecosystem has grown significantly in recent years, creating an evenmore robust marketplace for investorsand accelerating demand among institutions. An increasingly wide range ofinvestors seeking access to Bitcoin hasunderscored the need for a more diversified set of products offering exposureto digital assets.”
GROWING NUMBER OF BITCOIN
VanEck, WisdomTree, SkybridgeCapital in partnership with First TrustAdvisors, Valkyrie Digital Assets andNYDIG Asset Management have all filedfor Bitcoin ETFs with the SEC, whichhad rejected several Bitcoin ETF applications in the past.
Chris Kuiper, vice president of equityresearch at CFRA, said the Fidelity filing was “big news” given that “Fidelityis one of the largest asset managersaround with trillions of dollars in assetsunder management.
“We think this shows the continuingdemand for a bitcoin ETF as well asthe continued infrastructure being builtaround bitcoin products. Fidelity hasactually been a leader in the space withtheir digital assets division so it is notsurprising they will be looking to createan ETF,” he said.
Kuiper expects the Fidelity ETF,if approved, will be “a very competitive and low-cost fund” that wouldhelp expose many investors to Bitcoin,“including possibly those in 401(k) plansmanaged by Fidelity.”
Bernice Napach can be reached at
By Bernice Napach
Grayscale Plans to Convert Bitcoin Fund to ETF
Also, as the trend continues, Fidelity files for its own Bitcoin ETF.