Grayscale, the administrator of the Grayscale Bitcoin Trust (GBTC), plans to renew its trust agreement for the first time since 2018. This was revealed in a filing on the 29th.
The objective is to optimize the structure of GBTC in preparation for the expected listing of a Bitcoin spot ETF (exchange traded fund), and to improve competitive conditions with other ETF applicants such as BlackRock, the world’s largest asset management company. It’s about being equal.
Two proposed amendments to the trust agreement
The GBTC update submitted for shareholder vote includes two proposed amendments to the trust agreement.
The first is to allow Grayscale to pay daily fees instead of monthly fees. A Grayscale spokesperson said this is a structural adjustment, not a rate reduction, and that the company is working on it, but it is not finalized at this time.
Grayscale currently charges a 2% management fee on GBTC. A typical fee range for companies awaiting approval for a Bitcoin spot ETF is 0.7% to 1%, according to an analyst report from Matrixport.
The second is to make it possible to mix assets in an omnibus account format. This will allow for smoother issuance and redemption, which are the core processing mechanisms for ETFs. This is an innovation that forms part of the Coinbase Custody service. BlackRock’s iShares product, like many other physical ETF filing companies, is set to use Coinbase custody.
Ready to list if approved
Analysts predict that the U.S. Securities and Exchange Commission (SEC) will likely approve multiple Bitcoin spot ETFs in quick succession. In particular, the winner of this race is expected to have a significant first-mover advantage in attracting a large portion of public investors, creating an atmosphere of excitement among applicant companies.
“Today, Grayscale announced proposed amendments to the GBTC Trust Agreement that are intended to provide operational efficiencies that we believe will be beneficial to both Grayscale and GBTC,” a Grayscale spokesperson said in an email. “Importantly, this is within the normal course of our business. GBTC will be listed on the NYSE Arca as a physical Bitcoin ETF, subject to appropriate regulatory approvals.” I’m ready to do it.”
The proposed amendments will not result in any additional cost to Grayscale shareholders, and neither is essential to the conversion to an ETF, the filing states. Shareholders will have 29 to 20 days to vote on the renewal proposal.
｜Translation and editing: Rinan Hayashi
｜Original text: Grayscale Gears Up for Spot Bitcoin ETF, Updating Trust Agreement for Sake of ‘Operational Efficiencies’