After the SEC's decision, GBTC shares are trading 35% below the BTC rate
After the rejection of the application to convert Grayscale Bitcoin Trust into a spot bitcoin ETF by the SEC, the fund's shares are trading at an unprecedented discount of 35%
The situation is ironic, given that the existing discount was one of Grayscale's main arguments in favor of the need for conversion. As reported, Grayscale held a private meeting with the SEC last month, at which it claimed that the conversion of GBTC into an ETF could potentially unlock $8 billion to investors by eliminating the discrepancy.
Back then, GBTC shares were trading at about a 25% discount against BTC, meaning it was 25% cheaper to buy GBTC shares than the asset they represent. Now this discount has increased to 35%. The BTC rate also continued to fall, partly due to the rejection of Grayscale's application for an ETF.
Grayscale is the world's largest crypto asset management company. At the moment, Bitcoin Trust manages assets worth about $12.9 billion.
Grayscale CEO Michael Sonnenshine has been campaigning since October to convince the SEC to allow GBTC conversion. It was then that the first bitcoin futures ETF was approved, and this gave rise to confidence that a spot ETF would soon follow. However, SEC Chairman Gary Gensler still opposes spot bitcoin ETFs, often citing market manipulation and consumer protection concerns. Grayscale considers such a policy discriminatory and has announced a lawsuit against the SEC for not applying a consistent approach to similar investment instruments.
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