Grayscale Investments Discusses Proposed Bitcoin ETF with JPMorgan and Goldman Sachs
Summary:
Grayscale Investments, a cryptocurrency asset manager, is in discussion with JPMorgan and Goldman Sachs for their potential involvement in its proposed Bitcoin ETF. Goldman Sachs is also reportedly negotiating with BlackRock to act as an authorized participant in their ETF. The approval of a Bitcoin ETF, which has never happened in the U.S., is expected to mature the cryptocurrency market and attract more institutional investment. Currently, 14 asset managers aim to issue a Bitcoin ETF, providing regulated Bitcoin exposure to U.S. institutional investors.
Grayscale Investments, a cryptocurrency asset manager, is allegedly in discussion with companies like JPMorgan and Goldman Sachs about their possible contribution to its proposed Bitcoin ETF. On January 4th, insiders revealed to Bloomberg that negotiations had taken place between Grayscale and these investment banks. Merely a few days prior, an amended S-3 application had been submitted to the SEC by Grayscale, however, no authorized participants were mentioned.
Simultaneously, Goldman Sachs is said to also be in conversation with BlackRock about becoming an authorized participant in their respective ETF, according to an earlier media report. BlackRock had previously updated its S-1 filing to list Jane Street, a quantitative trading company, and JPMorgan as authorized participants in their proposed ETF.
It's worth noting that the role of an authorized participant is crucial in managing an ETF, facilitating the creation and redemption of shares within the fund. Interestingly, ETF applicants are not obligated to name their authorized participants in their S-1 or S-3 filings, leaving the door open for other financial firms to participate.
While JPMorgan is a recognized participant for numerous proposed Bitcoin ETFs, Goldman Sachs might join the ranks of Wall Street heavyweights such as Cantor Fitzgerald and Jane Street who are also authorized participants for various issuers.
Historically, Goldman Sachs has maintained a neutral position towards digital currencies and the broader digital asset industry. In a recent interview, Goldman's Head of Digital Assets, Matthew McDermott, expressed that a Bitcoin ETF approval would stimulate growth in the cryptocurrency market and attract a wave of institutional investment.
As it stands, a Bitcoin ETF has never been greenlighted in the United States. However, ETF analysts are estimating a 90% chance of approval before January 10th of this year.
Currently, 14 asset managers are seeking to sanction a Bitcoin ETF, providing direct and regulated Bitcoin exposure to institutional investors in the United States.
Published At
1/4/2024 7:09:15 AM
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