Grayscale ready to file application for converting Bitcoin fund into spot ETF

• Grayscale Investments is planning to file an application with the SEC to convert its flagship product into a Bitcoin ETF.
• This move comes after a Bitcoin futures-based ETF was greenlit by the securities regulator last week.
• Grayscale’s Bitcoin ETF would be backed by actual units of the bellwether cryptocurrency.

While the first Bitcoin exchange-traded fund (ETF) is about to start trading this week after it was greenlit by the United States Securities & Exchange Commission, Grayscale Investments is planning to apply to convert its BTC fund into a spot ETF. 

Grayscale to seek approval for spot Bitcoin ETF

The ProShares Bitcoin Strategy ETF will be the first Bitcoin ETF to start trading in the United States this week. The fund will give investors exposure to BTC futures contracts, rather than the spot market, trading under the ticker “BITO.” The NYSE Arca certified its approval for listing the fund, and investors will be allowed to trade the ETF later this week.

A report by CNBC revealed that Grayscale is planning to seek approval for a spot Bitcoin ETF, citing a person with knowledge of the matter. Once the application is filed, a 75-day review period will start. Still, the securities regulator could still choose to delay or reject the firm’s application. 

Currently, Grayscale already has a significant amount of the world’s Bitcoin holdings for its BTC trust, GBTC. The fund had $38.7 billion in assets under management as of late last week. 

Grayscale previously revealed its intentions of seeking approval for a Bitcoin ETF in April once the regulatory environment in the US becomes more open to the leading cryptocurrency. 

If the SEC approves of Grayscale’s Bitcoin ETF and the firm can convert GBTC into an ETF, shareholders would no longer need to endure a six-month lockup and a 2% annual management fee, taking the crypto trust more in line with the net asset value of the bellwether cryptocurrency.

In addition, the CEO of Digital Currency Group, the company behind Grayscale, urged his Twitter followers to “stay tuned” when asked when the trust would be converted into a spot Bitcoin ETF.

Bitcoin price on track to record new all-time high

Bitcoin price has been steadily climbing in the past week, as hopes of a Bitcoin ETF approval led to bullish sentiment. On the 4-hour chart, the leading cryptocurrency has printed an ascending parallel channel pattern, suggesting that BTC is ready to reach a new record high.

The prevailing chart pattern puts the bullish target of $65,231 on the radar, coinciding with the breakout line given by the Momentum Reversal Indicator (MRI). Until then, Bitcoin price sees little resistance holding the bellwether cryptocurrency back from aiming for bigger aspirations.

BTC/USDT 4-hour chart

The first line of defense for Bitcoin price is at the 20 four-hour Simple Moving Average (SMA) at $60,665, then at the upper boundary of the governing technical pattern at $60,387, then at The middle boundary of the channel at $58,048, coinciding with the 50 four-hour SMA.

Further selling pressure may push Bitcoin price lower toward the support line given by the MRI at $56,887 before resorting to the downside trend line of the chart pattern at $55,903.

 

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