Grayscale CEO Urges SEC for Simultaneous Approval of Spot Bitcoin ETFs

Grayscale CEO Urges SEC for Simultaneous Approval of Spot Bitcoin ETFs

Crypto News – In a recent Bloomberg TV interview, Michael Sonnenshein, CEO of Grayscale, emphasized the need for the Securities and Exchange Commission (SEC) to adopt a unified approach in approving spot Bitcoin (BTC) exchange-traded funds (ETFs). Sonnenshein argued for a level playing field, advocating for simultaneous approval of ready-to-launch ETFs.

“As firm proponents, we believe the SEC, once prepared, should greenlight spot product launches collectively. This ensures those operationally primed can debut in unison,” Sonnenshein remarked.

Reinforcing Grayscale’s readiness, Sonnenshein announced plans to transition the Grayscale Bitcoin Trust (GBTC) into an ETF, promising to reduce the current 2% expense ratio upon its ETF inception.

Grayscale earlier claimed a noteworthy triumph over the SEC in its bid to convert the trust into an ETF. The focus now shifts to the various contenders, exceeding ten, each eyeing the first approval nod for their respective spot Bitcoin ETFs. The approval’s timing is critical, offering a strategic edge in capturing investor attention and capital.

Concerns Over Potential Delays in Grayscale’s ETF Launch

Sonnenshein voiced concerns about the detrimental impact on Grayscale and its stakeholders if the SEC fails to allow a concurrent launch with other ETFs. “Such a move could severely disadvantage our vast GBTC investor base, especially if other products precede ours in the market,” he cautioned.

The decade-long quest for a Bitcoin ETF nears a critical juncture with impending deadlines in early January. Regulators are set to review applications from ARK and 21Shares, with many analysts believing their approval could set a precedent for others.

The Debate Over In-Kind Versus Cash Redemptions

A significant hurdle for issuers involves choosing between in-kind and cash redemptions for ETFs. In-kind redemptions involve exchanging fund securities with market makers instead of cash transactions. However, regulatory apprehension regarding broker-dealers managing Bitcoin might deter in-kind redemptions for Bitcoin ETFs.

Sonnenshein expressed strong support for the in-kind model. “It’s a proven, investor-friendly approach fostering narrow spreads and liquidity. At this crucial juncture for spot Bitcoin ETFs, adherence to this established model is paramount,” he asserted.