Grayscale in Talks With SEC Over Spot Bitcoin ETF Conversion

Grayscale Investments, the largest digital asset manager in the world, is in discussions with the U.S. Securities and Exchange Commission (SEC) over its bid to convert its flagship product, the Grayscale Bitcoin Trust (GBTC), into a spot Bitcoin exchange-traded fund (ETF).

According to a report by CoinDesk, Grayscale has been in contact with both the SEC’s Division of Trading and Markets and the Division of Corporation Finance since winning a court fight last month that overturned the agency’s rejection of its ETF application.

Grayscale Remains Confident About ETF Approval

Grayscale’s chief legal officer, Craig Salm, said the company is “laser-focused” on re-engaging with the SEC and that it is a matter of “when not a matter of if” for the approval of a spot Bitcoin ETF.

A spot Bitcoin ETF would allow investors to buy and sell shares that directly track the price of Bitcoin, without the need for intermediaries or custody solutions. Currently, GBTC trades at a discount to its net asset value, meaning that investors are paying less than the actual value of the underlying bitcoin.

Grayscale is not the only company seeking to launch a spot Bitcoin ETF in the U.S. Several other firms, including BlackRock and Fidelity, have also filed applications with the SEC, which has so far delayed or rejected all of them.

The SEC has expressed concerns about the potential for fraud, manipulation, and investor protection issues in the Bitcoin market. However, some observers believe that the agency may be more open to approving a spot Bitcoin ETF under the new leadership of Chair Gary Gensler, who has a background in crypto and blockchain.

Approval of a spot Bitcoin ETF would be a major milestone for the crypto industry, as it would provide easier access and exposure to Bitcoin for retail and institutional investors. It would also likely boost the demand and price of the leading cryptocurrency, which has been trading sideways in recent weeks.