Grayscale CEO: BlackRock ETF Submits Validation Moment for Bitcoin

The surge in Bitcoin exchange-traded fund (ETF) filings in recent weeks should be seen as a significant validation for Bitcoin, according to Michael Sonnenshein, CEO of Grayscale Investments.

During a July 12th interview on CNBC’s “Last Call,” Sonnenshein dismissed the idea that BlackRock’s entry into the Bitcoin ETF race was “uncool.” He explained, “Seeing the largest asset manager in the world literally publicly commit to advancing its crypto efforts only reinforces the validity of the asset class and its staying power.”

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In the last four weeks alone, seven major institutional firms, including BlackRock, have submitted applications for a spot in Bitcoin ETF in the United States

If approved, these ETFs would offer both institutional and retail investors in the U.S. an easy and legally compliant way to participate in the bitcoin price without actually owning the cryptocurrency. Sonnenshein emphasized the benefits of the ETF structure, stating, “The ETF wrapper has proven itself and has become the access point for so many different assets, whether it’s commodities or equities. Bitcoin is an asset that is not going away. Investors want and deserve access to it.”

Grayscale offers U.S. investors an indirect method of accessing Bitcoin through its Grayscale Bitcoin Trust (GBTC), which allows investors to trade shares in trusts that hold large amounts of Bitcoin. However, the company intends to convert GBTC into a spot Bitcoin ETF, which would provide investors with an easier way to trade the price of Bitcoin without the discount to net asset value that GBTC currently experiences.

Sonnenshein acknowledged the importance of this transition, stating, “Being able to provide investors with bitcoin exposure through GBTC, as we do today, was an incredible milestone. But moving to an ETF structure will give investors the added protection they want.”

In June 2022, Grayscale filed a lawsuit against the U.S. Securities and Exchange Commission (SEC) after its 2021 application to convert GBTC was denied. Sonnenshein expressed optimism about the lawsuit, noting, “If we are successful in this challenge, it could actually free up billions of dollars of investor capital.”

BlackRock’s application for a spot Bitcoin ETF on June 15th led to a price increase of more than 20% for the cryptocurrency, reaching an annual high of $31,460 on July 6. Currently, bitcoin is trading at $30,633.

Overall, the recent influx of Bitcoin ETF filings is seen as a significant endorsement for teh cryptocurrency by industry experts like Sonnenshein. The potential approval of these ETFs would provide investors with a more accessible and regulated way to participate in the Bitcoin price, further solidifying the asset’s legitimacy in the financial world.

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(Featured image by Art Rachen via Unsplash)

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