Grayscale Revises Bitcoin ETF Filing, Incorporates Cash Creation Model
In Brief
Grayscale submitted a revised S-3 filing to the SEC, aligning with the cash creation model suggested earlier by the US SEC.
Digital currency asset management company Grayscale, submitted another revised S-3 filing to the United States Securities and Exchange Commission (SEC). In the amended S-3 filing, Grayscale aligned with the cash creation model, as suggested earlier by the regulator.
The ongoing debate between asset managers seeking to launch a spot Bitcoin ETF and the SEC has centered on the choice between cash and in-kind creations.
Typically, stock and commodity-based exchange-traded funds ETFs operate on an in-kind model, allowing fund market participants direct handling of assets in the fund. On the contrary, a cash-creation model for a spot Bitcoin ETF implies that new shares can only be created or redeemed through cash transactions.
The SEC’s recent move to restrict broker-dealers from directly dealing with Bitcoin is seen as an effort to enhance tracking of Bitcoin movements from exchanges, addressing potential risks associated with anti-money laundering or Know Your Customer (KYC) compliance.
Until recently, Grayscale was hesitant to give up the fight for in-kind creations. The new development followed the chief executive officer of Grayscale parent company Digital Currency Group, Barry Silbert’s resignation from Grayscale’s board of directors.
Companies Adjust Spot Bitcoin ETF Filings adding Cash Redemptions
Currently, approximately thirteen companies have applied for a spot Bitcoin ETF, valued based on the real-time price of the digital asset.
In a recent development, Multinational investment company BlackRock also revised its proposed filing for a spot Bitcoin ETF and incorporated the option for cash redemptions.
The adjustment is seen as a strategic move to enhance the likelihood of obtaining approval from the SEC.
The company prioritized obtaining SEC approval for its proposed Bitcoin ETF as a key corporate goal, describing Bitcoin as an “international asset” and a “store of value” comparable to gold.
Recent adjustments in Grayscale and BlackRock Bitcoin ETF filings, reflect companies’ adaptability amid the ongoing debate with the SEC, highlighting the evolving interest among companies to launch spot Bitcoin ETFs.
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
