Grayscale Engages SEC In Key Talks: Fuels Hope For Spot Bitcoin ETFs

Grayscale Bitcoin Trust (GBTC) reportedly held a meeting with the Securities and Exchange Commission’s (SEC) Division of Trading and Markets. The division is responsible for evaluating and deciding on Rule 19b-4 applications, crucial for the listing and trading such ETFs.

Bloomberg analyst James Seyffart shared insights on the meeting via a Twitter thread, revealing that Grayscale engaged with the SEC’s Division of Trading and Markets to discuss potential listing matters related to the Grayscale Bitcoin Trust (GBTC). Seyffart also mentioned hearing about other potential Bitcoin spot ETF issuers having meetings with the SEC over the past week.

Seyffart highlighted the Transfer Agent agreement between Grayscale and the Bank of New York Mellon (BNY Mellon) in a recent 8K filing by GBTC. According to Seyffart, this agreement was expected and may not provide insights into the timing of the ETF approval process. Scott, who brought attention to the agreement, is noted for his comprehensive awareness of market developments.

Addressing the probability of SEC approval by January 10th, Seyffart expressed confidence, stating that recent events have not altered his and Eric Balchunas’s (Senior ETF Analyst for Bloomberg) odds, which are capped at 90%. Despite this, Seyffart emphasized that progress is continuing, indicating positive momentum.

Grayscale’s Ongoing Efforts

Nevertheless, the SEC’s memo revealed that the meeting centered around NYSE Arca, Inc.’s proposed rule change to list and trade shares of the Grayscale Bitcoin Trust under NYSE Arca Rule 8.201-E. Grayscale’s filing of a new registration statement last month marked its latest attempt to transform the trust into a spot Bitcoin ETF. A D.C. circuit court mandate issued in August directed the SEC to re-review the application.

In a notable development, Grayscale and BNY Mellon agreed last week to have BNY Mellon serve as the transfer agent for GBTC shares. GBTC plans to list the shares on NYSE Arca under the symbol GBTC and issue the shares continuously upon approval of its S-3 form and a separate 19b-4 filing from NYSE Arca, as per the S-3 filing submitted on October 19th.

However, the race for spot Bitcoin ETF approval extends beyond Grayscale, with major asset managers such as BlackRock and Fidelity also seeking SEC approval for similar products. SEC Chair Gary Gensler confirmed last month that the regulator is actively reviewing these filings, underscoring the growing interest and anticipation in the cryptocurrency market regarding the approval of spot Bitcoin ETFs.

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