Valkyrie wants to take over GBTC: Plans Revealed

• Valkyrie Investments revealed plans for GBTC management. 
• Citing previous experience in management of similar  assets. 
• GBTC has been offering massive discounts on NAV throughout 2022. 

2022 has not been a great year for the crypto industry, for various reasons major players either filed for collapse, filed for bankruptcy, or are struggling just to stay afloat. Similar is the situation for the world’s largest BTC trust, Grayscale Bitcoin Trust (GBTC). They have been offering huge discounts on net asset value (NAV), begging the question about the future of GBTC. Valkyrie Investment wants to take over. 

Co-founder and CIO of Valkyrie Innvestment Steven McClurg, in a statement released on December 28, 2022 on their website, disclosed regarding the company’s interest in taking over the management of GBTC. 

The released statements hits towards the various challenges that are been faced by GBTC, 

To clarify  as to why Valkyrie is a better choice for GBTC’s management, the report highlights the previous experience of managing their own BTC fund, which is maintaining daily healthy liquidity since launch a year ago. Also multiple BTC ETFs were launched in 2021. 

Team Valkyrie understands the pivotal role played by Grayscale in BTC ecosystem growth with the launch of GBTC. The statement further reads as 

“In the light of recent events involving Grayscale and its family of affiliated companies, it is time for a change. Valkyrie is the best company to manage GBTC to ensure its investors are treated fairly. 

In order to take advantage of GBTC discount on NAV, the company announced a fund called “Valkyrie Opportunistic Fund, LP.” 

McClurg further says that: “we are very interested in realizing the true value of the underlying bitcoin for our investors and will actively pursue this goal on their behalf.”

How Valkyrie could revamp GrayScale

The statement on their website highlights their three steps to improve the GBTC’s management in case they take over. 

First Step

Facilitate orderly redemption for investors at NAV, at the time of Regulation M filing. This could allow investors to redeem shares at fair price and without any delay. 

Second Step

Lowering the fees associated with the fund. Valkyrie wishes a 50%  plus fees reduction, in order to fit in. reducing the fee from 200 basis points to 75 basis points. 

Third Step

Honor investors in both cash and BTC, because Valkyrie believes that this step would provide investors a “greater flexibility and choice when it comes to redeeming shares.”

While closing the statement, McClurg said that 

“We are committed to putting the interest of GBTC shareholders first, and we have the experience and expertise to do so effectively.”

On December 30, 2022, GBTC NAV discount was 45.17%, while it was recorded to be 48.57% on December 16, 2022. 

Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.

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