With many analysts speculating the outcomes of the Spot Bitcoin ETF race, partner at CEHV, Adam Cochran, shares his perspective in a Nov. 8 post on X.
From Cochran’s perspective, while odds are good for other ETFs, the Digital Currency Group (DCG) and more specifically the asset management unit Grayscale, may be have a tough road ahead.
Effects of Genesis’ downfall
Cochran suggests that DCG CEO Barry Silbert’s situation comes as a result of the Genesis shutdown, the absence of updates regarding GBTC conversion following a court case, the lack of price arbitrage opportunities on smaller trusts, ongoing discussions surrounding a potential fraud investigation, and the ongoing legal case with Gemini, all contributing to an atmosphere of uncertainty and concern.
In a follow-up post in his thread, Cochran goes on to share that although there remains the possibility of obtaining a GBTC conversion, the likelihood of GBTC gaining approval does not necessarily insulate Silbert and Grayscale from broader challenges.
1/5While odds are *really* good for other ETFs, I think Barry Shillbert might be cooked.-Genesis shutdown-No update on GBTC conversion after court case-No price arb on the smaller trusts-On going talk of fraud investigation-Case with Gemini — Adam Cochran (adamscochran.eth) (@adamscochran)
Cochran ends the thread questioning whether the 10% discount offered is worth the decision to refrain from holding direct BTC while awaiting BlackRock’s potential approval.
Continuing the race
Days earlier, Co-founder of Valkyrie Investments Steven McClurg shared that the SEC is in a position to grant approval to several spot Bitcoin ETF applications in November 2023.
In the evaluation, McClurg notes that companies have effectively addressed the concerns related to market manipulation that had been raised by the regulator. Therefore, while the SEC may issue another round of comments to the entities that submitted ETF applications in the coming one to three weeks, an approval of 19b-4 rule changes is likely shortly after.
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