As Michael Sonnenschein, CEO of investment company Grayscale, has said in an interview with Financial News, the company wants to convert its GBTC Bitcoin fund into an exchange-traded fund (ETF).
According to him:
"It’s our No. 1 priority as a firm. The SEC has created an unfair playing field and forced investors into a futures-based ETF because it’s the only product that exists."
The Grayscale Bitcoin Trust is the world's largest crypto fund. According to the company, it manages assets worth more than $27 billion.
GBTC shares trade at a discount of close to 27% to their net asset value (NAV). The discount has been observed since March 2021. As the fund's share prices have fallen more than 40%, Bitcoin has lost about 15% in price.
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Grayscale's parent company Digital Currency Group (DCG) wants to close the gap with NAV by repurchasing crypto trust shares.
According to Form 8-K, by March 2022, the organization had already spent $698 million to buy GBTC shares, but this did not lead to a visible result. That same month, DCG announced another $250 million share buyback program.
One possible solution to the problem is to convert the funds into spot ETFs that trade according to the market price of the underlying assets. However, this requires SEC approval.