Grayscale Investments Engages with SEC on Bitcoin ETF Application

Grayscale Investments Seeks to Convert Bitcoin Trust into ETF

Crypto asset manager Grayscale Investments is currently engaging with the U.S. Securities and Exchange Commission (SEC) regarding its application to convert its flagship bitcoin trust into a spot bitcoin exchange-traded fund (ETF), according to CEO Michael Sonnenshein. Sonnenshein believes that Grayscale has a significant advantage over other spot bitcoin ETF applicants.

In an interview with Bloomberg at DC Fintech Week, Grayscale Investments CEO Michael Sonnenshein discussed the company's plan to convert its flagship bitcoin trust (GBTC) into a spot bitcoin ETF. The SEC previously rejected Grayscale's application for a spot bitcoin ETF. However, a court has recently ordered the SEC to reevaluate the application.

"A couple of months ago, a decision came out of the D.C. Circuit that vacated the SEC's denial of the GBTC uplisting to a spot Bitcoin ETF on the New York Stock Exchange. We really respected and continue to respect the court process," Sonnenshein stated.

He further explained that after the court's decision, there was a period during which the SEC could have challenged it, but they chose not to. Grayscale has since submitted the necessary filings, including the S-3 filing, which allows for a constructive dialogue with the SEC and supports the company's move towards an uplisting on the NYSE. Sonnenshein added that the SEC is currently engaging constructively.

Grayscale's Advantage Over Other Bitcoin ETF Applicants

Sonnenshein believes that Grayscale has a significant advantage over other spot bitcoin ETF applicants due to the company's well-established track record. Grayscale Bitcoin Trust (GBTC) has been a well-known seasoned issuer for several years, allowing the company to file an S-3, a simplified registration statement, as opposed to the more comprehensive S-1 filings required by other issuers.

Other spot bitcoin ETF applicants do not yet have a product, investors, or trading history. Sonnenshein remains optimistic that Grayscale will overcome any final hurdles and provide its investors with the product they have been patiently waiting for.

Grayscale has been operationally ready to operate GBTC as an ETF for some time and has made this known to the SEC. Sonnenshein welcomes competition in the market, stating that Grayscale is prepared for a world with multiple spot bitcoin products, much like there are multiple bitcoin futures products.

SEC's Consideration of Bitcoin ETF Applications

SEC Chairman Gary Gensler recently stated that the regulator is considering between eight and ten spot bitcoin ETF applications. Analysts, including those at JPMorgan, anticipate that the SEC will approve multiple spot bitcoin ETFs simultaneously in early 2022. Alliance Bernstein, a global asset management firm, predicts that the price of bitcoin will reach $150,000 by 2025 and anticipates the imminent approval of spot bitcoin ETFs.

What are your thoughts on the SEC's potential approval of Grayscale Investments' application to convert GBTC into a spot bitcoin ETF? Let us know in the comments section below.

Frequently Asked Questions

How much should your IRA include precious metals

It is important to remember that precious metals can be a good investment for anyone. They don't require you to be wealthy to invest in them. There are many methods to make money off of silver and gold investments.

You may consider buying physical coins such as bullion bars or rounds. Also, you could buy shares in companies producing precious metals. Or, you might want to take advantage of an IRA rollover program offered by your retirement plan provider.

You can still get benefits from precious metals regardless of what choice you make. They offer the potential for long-term, sustainable growth even though they aren’t stocks.

Their prices rise with time, which is a different to traditional investments. If you decide to make a sale of your investment in the future, you will likely realize more profit than with traditional investments.

How much gold can you keep in your portfolio

The amount you make will depend on the amount of capital you have. A small investment of $5k-10k would be a great option if you are looking to start small. Then as you grow, you could move into an office space and rent out desks, etc. This will allow you to pay rent monthly, and not worry about it all at once. You only pay one month.

It's also important to determine what type business you'll run. In my case, I run a website-creation company. Our clients pay us between $1000-2000/month and depending on their order. You should also consider the expected income from each client when you do this type of thing.

If you are doing freelance work, you probably won't have a monthly salary like I do because the project pays freelancers. You might get paid only once every six months.

You must first decide what kind and amount of income you are looking to generate before you can calculate how much gold will be needed.

I would recommend that you start with $1k-2k worth of gold and then increase your wealth.

Is gold a good investment IRA option?

Any person looking to save money is well-served by gold. It is also an excellent way to diversify you portfolio. But gold has more to it than meets the eyes.

It's been used as a form of payment throughout history. It is often called “the most ancient currency in the universe.”

Gold, unlike other paper currencies created by governments is mined directly from the earth. Because it is rare and difficult to make, it is extremely valuable.

The supply and demand for gold determine the price of gold. The strength of the economy means people spend more, and so, there is less demand for gold. Gold's value rises as a result.

On the flipside, people may save cash rather than spend it when the economy slows. This increases the production of gold, which in turn drives down its value.

It is this reason that gold investing makes sense for businesses and individuals. You will benefit from economic growth if you invest in gold.

Additionally, you'll earn interest on your investments which will help you grow your wealth. You won't lose your money if gold prices drop.

How to open a Precious Metal IRA

The first step in opening an Individual Retirement Account, (IRA), is to decide if it's something you want. If you do, you must open the account by completing Form 8606. For you to determine the type and eligibility for which IRA, you need Form 5204. You must complete this form within 60 days of opening your account. You can then start investing once you have this completed. You can also choose to pay your salary directly by making a payroll deduction.

Complete Form 8903 if your Roth IRA option is chosen. Otherwise, the process will look identical to an existing IRA.

To be eligible to have a precious metals IRA you must meet certain criteria. The IRS states that you must be at least 18 and have earned income. Your annual earnings cannot exceed $110,000 ($220,000 if you are married and file jointly) for any tax year. Contributions must be made regularly. These rules are applicable whether you contribute through your employer or directly from the paychecks.

You can use a precious-metals IRA to purchase gold, silver and palladium. However, you won't be able purchase physical bullion. This means you won't be allowed to trade shares of stock or bonds.

Your precious metals IRA can be used to directly invest in precious metals-related companies. This option is offered by some IRA providers.

However, there are two significant drawbacks to investing in precious metals via an IRA. First, they're not as liquid as stocks or bonds. This makes them harder to sell when needed. Second, they don't generate dividends like stocks and bonds. You'll lose your money over time, rather than making it.

Can I buy Gold with my Self-Directed IRA?

You can purchase gold with your self-directed IRA, but you must first open an account at a brokerage firm like TD Ameritrade. Transfer funds from an existing retirement account are also possible.

The IRS allows individuals to contribute up to $5,500 annually ($6,500 if married and filing jointly) to a traditional IRA. Individuals can contribute as much as $1,000 per year ($2,000 if married filing jointly) to a Roth IRA.

If you do decide that you want to invest, it is a good idea to buy physical bullion and not in futures. Futures contract are financial instruments that depend on the gold price. You can speculate on future prices, but not own the metal. However, physical bullion is real gold or silver bars you can hold in your hands.

Who owns the gold in a Gold IRA?

The IRS considers any individual who holds gold “a form of income” that is subject to taxation.

This tax-free status is only available to those who have owned at least $10,000 of gold and have kept it for at minimum five years.

While gold may be a great investment to help prevent inflation and volatility in the market, it's not wise to keep it if you won't use it.

If you plan to sell the gold one day, you will need to report its worth. This will affect how much capital gains tax you owe on cash you have invested.

Consult a financial advisor or accountant to determine your options.

How Does Gold Perform as an Investment?

The supply and the demand for gold determine how much gold is worth. It is also affected by interest rates.

Due to their limited supply, gold prices fluctuate. In addition, there is a risk associated with owning physical gold because you have to store it somewhere.


  • (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (
  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (
  • If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (
  • The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (
  • You can only purchase gold bars at least 99.5% purity. (

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How To

Tips for Investing in Gold

Investing in Gold has become a very popular investment strategy. There are many benefits to investing in gold. There are many options for investing in gold. Some people purchase physical gold coins. Others prefer to invest their money in gold ETFs.

Before you purchase any type or gold, here are some things to think about.

  • First, check to see if your country permits you to possess gold. If your country allows you to own gold, then you are allowed to proceed. You can also look at buying gold abroad.
  • The second thing you need to do is decide what type of gold coins you want. You have the option of choosing yellow, white, or rose gold.
  • Thirdly, you should take into consideration the price of gold. It is best to begin small and work your ways up. One thing that you should never forget when purchasing gold is to diversify your portfolio. Diversifying your portfolio should be a priority, including stocks, bonds and real estate.
  • Lastly, you should never forget that gold prices change frequently. Keep an eye on current trends.

By: Kevin Helms
Title: Grayscale Investments Engages with SEC on Bitcoin ETF Application
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Published Date: Sat, 11 Nov 2023 03:30:37 +0000

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