The world’s largest bitcoin fund could become an ETF in July as GBTC hits nearly $ 40 billion in AUM

Grayscale could launch a Bitcoin Exchange Traded Fund (BTC) (ETF) as early as July 2022, said one of its executives.

At a virtual event hosted by MarketWatch on October 27th, David LaValle, Grayscale’s global head of ETFs, announced a nine-month deadline for US regulatory approval.

Grayscale: Now is the time to apply for an ETF

Grayscale, which operates the world’s largest Bitcoin investment product by volume, Grayscale Bitcoin Trust (GBTC), reiterated this month that it has “committed” to converting it into an ETF.

According to LaValle, the ideal time to apply is this week.

“We thought it was the perfect time to apply,” he said.

“Now that bitcoin futures products have fallen somewhat out of favor with the SEC, they will be happy to review the records of spot products.”

ETF filings require a 240-day analysis period with the Securities and Exchange Commission (SEC), opening the potential for an earlier operation in July.

In October, four ETFs got the green light, all of which were based on Bitcoin futures rather than spots, which Grayscale and others wanted to change.

GBTC had $ 38.8 billion in assets under management (AUM) on Thursday, with the total of all Grayscale funds currently being $ 53.1 billion.

Hayes: ETF market needs “fresh capital”

As Cointelegraph reported, hopes are high that spot ETFs will be allowed to operate from November in view of renewed criticism of futures-based products.

Related: GBTC offers better returns than Bitcoin ETF last week

JUST SAW ANALYSIS by a trader who manages the first roll of futures for #bitcoin ETFs (they switch to contracts before the new month). As many have predicted, it’s not nice – ETF investors are faced with massive tracking errors. Plus two flash issues in #BTC Course since the inception of the ETF. Pooh

– Caitlin Long (@CaitlinLong_) October 29, 2021

Arthur Hayes, the former head of derivatives trading giant BitMEX, made a scathing comment on the entire ecosystem this week.

“There is already a fake ETF with over $ 40 billion in assets under management, Grayscale Bitcoin Trust (GBTC). Technically, it’s not an ETF, but it’s still a treasure trove of assets. Therefore, AUM does not need to migrate from one tracker product to another, but rather new funding in the system, ”he wrote in his own blog post.

“If GBTC is added to the mix of US-listed tracking products, will there really be new demand from retailers and institutions that have not yet invested in this area? I fear that the narrative of institutional and private investors bringing AUM into the complex is misplaced as the people who want to get involved are mostly already there. “

The market had years to price in a potential ETF launch, which the SEC rejected several times and which gradually adjusted the price of Bitcoin over time.