Grayscale's Bitcoin ETF: Missing Authorized Participant and Fees Details Raise Questions

scales' proposal for a Bitcoin ETF back in 2017, citing concerns over market manipulation and investor protection. Since then, the company has made several amendments to its filing in an effort to address these concerns and gain approval from the SEC.

However, the latest amendment from Grayscale has raised eyebrows, as it does not mention who will partner with the firm as an authorized participant. In the world of ETFs, an authorized participant plays a crucial role in creating and redeeming shares of a fund, allowing investors to easily cash out. While the SEC does not typically require issuers of traditional asset ETFs to explicitly name their authorized participants, it has been flagged as an important step for Bitcoin ETFs.

Last week, major firms BlackRock and Valkyrie named their authorized participants in their ETF filings. BlackRock chose JP Morgan Securities and Jane Street, while Valkyrie named Jane Street and Cantor Fitzgerald. The fact that Grayscale did not specify its authorized participants in its latest amendment is notable, and many experts believe it could be the final hurdle in the application process for the long-awaited Bitcoin ETF.

Another key detail missing from Grayscale's amendment is the fees associated with its proposed ETF. Other applicants have already disclosed their fee structures, with Fidelity leading the pack with the lowest fees at just 0.39%. BlackRock plans to charge 0.47%, while Invesco and Galaxy have announced that their fund will waive fees for the first six months and then charge 0.59%. Grayscale's decision not to specify its fees sets it apart from other applicants.

It's important to note that Grayscale's ETF application is unique. The company aims to convert its popular Bitcoin Trust, GBTC, into a spot ETF. This would differentiate it from GBTC, which is only available to accredited investors and does not allow for share redemption. A Bitcoin ETF, on the other hand, would trade openly like stocks and provide greater accessibility to a wider range of investors.

Overall, Grayscale's latest amendment to its Bitcoin ETF filing has left some important details unanswered. The lack of information regarding authorized participants and fees raises questions about the company's strategy and the likelihood of approval from the SEC. As the battle for a Bitcoin ETF continues, investors and industry experts will be eagerly awaiting further updates from Grayscale and the SEC.