Apr. 22, 2022
Dear SEC, I write to you as a GBTC shareholder, in support of the conversion of Grayscale Bitcoin Trust (OTCQX: GBTC) to an ETF. I am an experienced (retail) investor that has a sizable investment (proportional to me) in GBTC. There are billions of dollars on the sidelines waiting for a spot ETF in order to enter this asset class. Bitcoin is the future and opening it up to an ETF will benefit me and others like me. Further, a spot bitcoin ETF will drive a lot of innovation in this space and around the world. This in turn creates many (livable wage) jobs and keeps the US as an innovation leader. By not approving this conversion, you are not protecting me. Last October, you approved futures-backed Bitcoin ETFs, but continue to reject applications for spot Bitcoin ETFs. Given that investors use both vehicles to gain exposure to the same underlying asset, Bitcoin—from which both vehicles derive their prices—we, as investors, should be able to choose if we’d like direct or futures-based exposure to that asset. Furthermore, the discount to NAV in GBTC has been around 25%, on average, this year. This means that the price of GBTC is less than the price of Bitcoin, the asset itself. Given that GBTC has about $30bn in AUM, shareholders like me are experiencing a destruction of value of around $7.5 billion. An ETF would more efficiently track the price of Bitcoin, effectively eliminating premiums and discounts and the high management fees. I’m writing from Connecticut, with gratitude for the opportunity to express my view and with the hope that you will approve this conversion and protect the interest of investors. Please support a spot Bitcoin ETF! Sincerely, John Russo