According to a person familiar with the situation, Grayscale Investments intends to apply to convert the world’s largest Bitcoin fund into a spot ETF early next week.
According to the individual, the investment company planned to file its application with the Securities and Exchange Committee (SEC) as soon as the government-approved competitor attempts for a future-based Bitcoin ETF. That occurred late on Friday.
The Grayscale application will begin a 75-day review process because the New York-based firm has not announced its plans.
Grayscale's ETF, if authorized, would be another step toward legitimizing the new crypto asset class.
Despite setbacks like being outlawed by China last month, Bitcoin has proven robust, nearing all-time highs of over $60,000 on Friday.
While the upcoming Bitcoin-futures ETF is noteworthy, some crypto investors believe it is an insufficient move because it will be tied to derivatives contracts traded on the Chicago Mercantile Exchange rather than genuine Bitcoin.
Grayscale's weak point The Bitcoin application, on the other hand, offers an investment backed by Bitcoins rather than derivatives linked to it.
Grayscale holds a significant portion of the world’s Bitcoin assets for its trusts, which is denoted by the symbol of GBTC.
As of Friday, GBTC managed $38.7 billion in assets.
The firm, which pioneered crypto investing by allowing institutional investors such as Ark Invest's Cathie Wood to bet on Bitcoin, first officially applied for an ETF in January 2017.
The application was withdrawn in October of that year when the SEC stated that it was not yet satisfied with the Bitcoin market.
Grayscale's actions might be an attempt to compel the SEC to take action.
According to the source, if authorities are okay with Bitcoin futures, they should also be comfortable with the underlying market.
Of course, the SEC has the option of delaying or rejecting the Grayscale application.
Grayscale's CEO openly chastised the SEC's apparent preference for futures-based ETFs last month, calling it a "shortsighted" decision that might hurt investors.