Grayscale CEO Michael Sonnenshein believes that the Securities and Exchange Commission (SEC) should approve spot Bitcoin exchange-traded funds (ETFs) simultaneously. In an interview with Bloomberg TV, Sonnenshein emphasized the importance of establishing a level playing field for all market participants.
Grayscale’s Readiness to List Grayscale Bitcoin Trust
Sonnenshein reaffirmed Grayscale’s readiness to list the Grayscale Bitcoin Trust (GBTC) as an ETF. He even committed to lower the expense ratio, currently at 2%, once it begins trading as an ETF. Earlier this year, Grayscale achieved a significant victory against the SEC as it sought to convert its trust into an ETF. Despite this, analysts speculate on which companies among the more than 10 applicants will receive regulatory approval first, as the timing of the approval can greatly influence investor interest and capital.
Obstacles in Launching Bitcoin ETFs
One of the main obstacles in launching Bitcoin ETFs is the issue of in-kind versus cash redemptions for the funds. In-kind redemptions involve exchanging the underlying securities of the fund with a market maker to create and redeem shares, instead of using cash. However, regulatory officials may be hesitant to allow in-kind redemptions for Bitcoin due to concerns about broker-dealers handling it. Therefore, issuers are working diligently to resolve this concern and align with regulatory expectations.
“The SEC should strive to establish a level playing field for all market participants.”
– Michael Sonnenshein, Grayscale CEO
Sonnenshein also expressed concern about potential repercussions if Grayscale was denied the opportunity to launch its ETF simultaneously with other applicants. The race for a Bitcoin ETF has been ongoing for over a decade, and it may soon reach a conclusion as a critical deadline approaches in early January. Market analysts speculate that if ARK and 21Shares, two applicants, receive regulatory approval, it could pave the way for others as well.
