Bitcoin Spot ETF Race: Grayscale Gets Back On Track With New Filing

In a strategic move to stay at the forefront of the Bitcoin Spot ETF race, Grayscale has filed a newly revised S-3 for its Spot Bitcoin ETF. The new filing will change the dynamics of Grayscale’s Bitcoin ETF through the incorporation of cash creations. 

Grayscale’s New Spot Bitcoin ETF Filing

Bloomberg Analyst, James Seyffart took to X (formerly Twitter) to announce that Grayscale, one of the world’s leading crypto asset management companies, has officially filed an amended S-3 for its Spot Bitcoin ETF.

The asset management company submitted the new filing to the United States Securities and Exchange Commission (SEC) on December 26. According to the filing, Grayscale will be changing to a cash-only policy and will be accepting just cash orders for its Spot Bitcoin ETF investments. 

“At this time an authorized participant can only submit cash orders, pursuant to which the authorized participant will deposit cash into, or accept cash from, the cash account in connection with the creation and redemption of Baskets,” the filing stated. 

It added:

“Cash orders will be facilitated by the Transfer Agent and Grayscale Investments, LLC, acting other than in its capacity as Sponsor, which will engage one or more eligible companies (each, a “Liquidity Provider”) that is not an agent of, or otherwise acting on behalf of, any authorized participant to obtain or receive Bitcoin in connection to such orders.”

Senior Bloomberg Analyst, Eric Balchunas also commented on the new change in Grayscale’s Spot Bitcoin ETF S-3 filing. “Grayscale finally surrendering to cash-only creations, was a big holdout. Pretty sure they have an AP agreement (a crucial last step) so that would check all the boxes. That said, still a mystery whether they will be allowed to go on day one of the Cointucky Derby,” Balchunas said. 

New Filing Comes Amidst Grayscale Chairman Resignation

Grayscale’s newly amended S-3 Bitcoin Spot ETF filing comes at the heels of the recent resignation of the CEO of Digital Currency Group (DCG), Barry Silbert from Grayscale’s Board of Directors. 

According to reports, Silbert’s resignation would be effective from January 1, 2024. The DCG CEO will be replaced by DCG’s Chief financial officer, Mark Shifke as the new Chairman of Grayscale.

A crypto community member, Ram Ahluwalia recently stated in an X (formerly Twitter) post that Silbert’s resignation presents a great opportunity for Grayscale CEO, Michael Sonnenshein. Ahluwalia speculated that Silbert stepping down as Chairman of Grayscale could potentially facilitate the conversion of Grayscale Bitcoin Trust (GBTC) to a Spot Bitcoin ETF. 

“This is a decision from Barry to improve the odds of the ETF approval. I doubt the SEC gave formal guidance to Barry to resign from the board,” Ahluwalia said. “Barry, by all accounts, is hands-on and would prefer control. The SEC should not weigh in on how Grayscale should govern itself. Perhaps the SEC might indicate informally the ‘strength’ of an application (purely speculating).”