Greyscale’s latest spot Bitcoin ETF update leaves authorized participants

Cryptocurrency asset manager Greyscale has filed an amended application for a Bitcoin Exchange-Traded Fund (ETF) without listing the details of its authorized participant.

Eric Balchunas, senior ETF analyst at Bloomberg, pointed to an updated filing by X (formerly Twitter) that clarified that authorized participants in the company's proposed ETF could pay and receive cash for shares.

New gray scale update just dropped. Clear language with cash only but still no AP named, name is blank where it should go. I'm not sure why the SEC wanted to see it and they're so excited to have one. Also nothing in terms of fees (that I can see). That's a big open q. pic.twitter.com/id8Tb8ImaP

— Eric Balchunas (@EricBalchunas) January 2, 2024

Balchunas also highlights that Greyscale left blank the names of authorized participants in an amended filing with the US Securities and Exchange Commission (SEC).

They were very upset about why the SEC wanted to see it and that it existed. Also nothing in terms of fees (that I can see). And that's a big opening.”

Cointelegraph reported on December 29 that seven companies vying to launch the first US Bitcoin ETF products filed their latest Form S-1 filings on December 29.

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Fidelity, WisdomTree and Invesco Galaxy listed their approved participants in the new filing. Invesco Galaxy selected Virtue and JPMorgan, while Wisdomtree and Fidelity listed Jane Street Capital.

Authorized participants are financial institutions or companies that can create and redeem ETF shares.

Grayscale has indicated that it intends to list Jane Street and Virtu Financial as authorized participants in June 2022 when it seeks to convert the Grayscale Bitcoin Trust into an ETF.

I thought Grayscale announced they were working with Jane Street and Virtu? Although this was last year. https://t.co/Sbpm8NM2zS

— Eleanor Terrett (@EleanorTerrett) January 2, 2024

Balchunas further commented that it was unclear why Grayscale deliberately left out its approved participants, while other companies have clarified these details.

“Yes, and they even tweeted that they have one, but as far as I know (in a Philly accent) it's not in the documentary yet (which the SEC wants) and we're not going to consider any horse official until we see it. Also, Blackrock, Fidelity and others did it, so why not? ” wrote Balchunas.

Grayscale filed an amended S-3 filing with the SEC on Dec. 27, the same day Barry Silbert — the CEO of parent company Digital Currency Group — announced his resignation from Grayscale's board of directors.

The SEC's final ruling on Bitcoin ETF issuers is scheduled for January 10, with the SEC submitting responses to applicant firms by the end of the first week of 2024.

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