Feb. 26, 2022
Mr. Gensler / SEC Employee, Digital Assets are the biggest innovation since the invention of the internet. These initial crypto projects built around decentralized open ledgers will be the building blocks for tremendous innovation, economic growth, and value creation moving forward. The United States of America (USA) should foster a welcoming and clear regulatory environment for these assets so our country can capitalize on the coming economic boom that will be created by the digital asset industry. This is particularly important because the barrier of entry to this industry is very low. The only necessary items to launch a crypto project are a computer and internet access. We do not want to risk falling behind the rest of the world and every day we delay regulatory action counts. Australia, Singapore, Brazil, Canada, and the European Union already have spot bitcoin ETFs. These countries are allies with the US and would require similar consumer protections prior to launching an ETF. The SEC has denied several spot ETF applications to date with little to no explanation provided to the applicant. If SEC has legitimate concerns related to a spot ETF it is imperative that it provide clear reasons for disapproval. Given the spot ETF approvals discussed above it is clear spot Bitcoin ETFs can be safe for customers and the US financial institutions are capable of structuring the product appropriately if given the proper guidance. The public prefers a spot Bitcoin ETF for several reasons. The fees on the currently approved Bitcoin futures ETFs are too high and the products are not easy for retail investors to understand. Nothing is more basic and investor friendly than a spot ETF. The public is confident that Greyscale’s proposed conversion of the Greyscale Bitcoin Trust to an ETF is safe because Greyscale has many years of experience storing the Bitcoin held by its trust safely. It also has shown it has the capability to purchase or sell any amount of bitcoin necessary to keep up with inflows or outflows from the ETF. Additionally, the Bitcoin spot market has more than enough volume to support the transactions necessary for managing the ETF. Further, the current structure of the Greyscale Bitcoin Trust is harmful to retail investors. The shares trade at a premium or discount to Net Asset Value. This benefits large hedge funds and family offices because they have the knowledge, capital, and relationships to make delta neutral profits by arbitraging the premium/discount through the options market. The ultimate result of this activity is syphoning money out of the market at the expense of retail investors, many of whom think they are buying into a spot ETF when they purchase $GBTC shares. The greatest gift America has ever received from China was when China banned Bitcoin. We need regulatory clarity on this asset class as soon as possible so that the USA can position itself as a leader in this emerging industry. The public deserves a safe and easy to understand method to invest in Bitcoin and Greyscale is uniquely positioned to offer this product to the public. The public requests the prompt approval of this Greyscale product or detailed reasons for disapproval so that Greyscale or other financial institutions can structure a compliant product as soon as possible. Best Regards, Brian Sak Title: Just a Guy