Grayscale, a prominent US crypto asset manager, today teased its recruitment process for its ETF (exchange-traded fund) team, offering an optimistic view of its long-running Bitcoin ETF filing.
The announcement came through a tweet it has already been viewed more than half a million times, underlining the great interest of the financial community in the subject.
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This move follows a wider industry debate over the U.S. Securities and Exchange Commission’s (SEC) stance on Bitcoin ETFs. Grayscale, in particular, has been in a tug-of-war with the SEC over its decision to use leveraged Bitcoin ETFs while rejecting spot Bitcoin ETF applications, a stance Grayscale has labeled “arbitrary.”
Last year, the SEC rejected Grayscale’s proposal to convert its Bitcoin Trust (GBTC) into an ETF, prompting the company to take legal action. They argued that a spot ETF was indistinguishable from a futures ETF, which the SEC had previously given the green light to.
Recent data from ycharts has shown that the GBTC’s discount to net asset value (NAV) has narrowed to 27.49%, with the stock trading around $20. In addition, GBTC shares are up nearly 43% over the past month, outpacing Bitcoin’s 17% rise over the same period. Market analysts have linked this performance boost to BlackRock’s application for a Bitcoin spot ETF, which prompted other traditional financial institutions, including Fidelity, to apply for similar ETFs.
The core of Grayscale’s argument against the SEC hinges on the approval of a 2x levered Bitcoin futures ETF, which uses leverage to double the daily performance of the S&P CME Bitcoin Futures Daily Roll Index. Grayscale argues that this exposes investors to an even riskier investment product than traditional Bitcoin futures exchange-traded products.
If the SEC’s decision leans in favor of Grayscale, it could set a precedent for the approval of future Bitcoin ETFs, potentially reshaping the crypto investment landscape. With many financial stakeholders eagerly awaiting the SEC’s verdict, Grayscale’s hint to expand its ETF team indicates the firm’s willingness to move, depending on the outcome.
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