Grayscale Submits Amended Spot Bitcoin ETF Application: What are the Changes?

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• According to Bloomberg’s James Seyffart, Grayscale submitted another amended S-3 application on Tuesday.
• The asset manager has updated its 2018 application several times. In November, it proposed two changes; the first one switched the fees from a monthly structure to a daily fee structure.
• Balchunas suggests that the introduction of cost-effective ETFs could significantly disrupt the current profitable model of many crypto exchanges.

According to James Seyffart of Bloomberg on Tuesday, Grayscale has once again updated its application for a spot Bitcoin ETF.

Grayscale Updates Spot Bitcoin ETF Filing

According to James Seyffart of Bloomberg on Tuesday, Grayscale has submitted another amended S-3 application, as reported. The news came within hours after Barry Silbert, the president of Grayscale Investments, stepped down from his position.

The application aims to convert the Grayscale Bitcoin Trust (GBTC) fund into a Bitcoin ETF. Seyffart reported that Grayscale is currently at a stage where it explicitly states, “it accepts instructions only for cash orders from the SEC.”

The application underscores the following: “Although the Trust creates Baskets only after acquiring Bitcoin and only distributes Baskets by delivering Bitcoin, an Authorized Participant may only submit Cash Orders…” Additionally, the document added: “The Trust may accept Cash Orders.”

As a crucial point, an S-3 form is a regulatory filing made with the Securities and Exchange Commission (SEC) to issue new securities or convert existing securities into a different class.

The asset manager has updated its 2018 application several times. In November, it proposed two changes; the first one switched the fees from a monthly structure to a daily fee structure. The second one changed how assets are combined, shares are created, and the process of redemption is simplified in a unified account.

By making strategic updates before the critical approval date in January, Grayscale seems to be preparing to compete in the ETF (Exchange-Traded Fund) market with major players like BlackRock.

ETFs Can Be Disruptive

Meanwhile, Bloomberg’s senior analyst Eric Balchunas, reiterating that ETFs are disruptive for offering low-cost investment options, has moved to X. Balchunas sees this as a similar scare to high-fee active managers and hedge funds, citing recent comments from a crypto exchange leader that Bitcoin could disappear if ETFs are approved.

The analyst highlights the striking difference in earnings between crypto exchanges and ETF markets, with the former earning much more despite having less volume. Balchunas suggests that the introduction of cost-effective ETFs could significantly disrupt the current profitable model of many crypto exchanges.