Feb. 27, 2022
Dear SEC, I’m writing to support the conversion of Grayscale Bitcoin Trust (Symbol: GBTC), currently the world’s largest Bitcoin fund, to the first Spot Bitcoin ETF in the United States. I am an attorney with years of experience investing in various stocks, bonds, and commodities. At first, it made sense for the SEC to take a cautious approach to Bitcoin, which was a new technology that was morphing into a new investment category. It was subject to hype and sensationalistic media coverage. But as years have passed, Bitcoin and blockchain technology have become more familiar, more transparent, and better understood. It is unclear to me why the SEC continues to be reluctant to approve a Bitcoin spot ETF, which hurts the American investor for a multitude of reasons. Millions of American investors are now interested in Bitcoin. Many of these investors are traditional investors who feel safe with their well-established investing platforms such as Vanguard or Fidelity. Through these platforms, they have used ETFs to invest in non-equities like real estate and commodities like gold and platinum. These American investors are not interested in joining nascent platforms such as Coinbase or Robin Hood. They are not interested in holding Bitcoin in cold storage. Despite their interest in Bitcoin, they have no spot ETF option. Meanwhile, these same investors have watched citizens of other countries like Canada enjoy the opportunity that a Bitcoin spot ETF provides. It is as if American investors are stuck in the Middle Ages or in North Korea, helplessly watching as others race forward into an exciting new investing frontier. I thought America was always the world's innovator, always on the front lines of opportunity. Holding back a Bitcoin spot ETF is repression and denial of opportunity--anti-American behavior in my opinion. The SEC claims that a Bitcoin spot ETF is subject to manipulation and fraud, and that they are protecting American investors. This argument is becoming increasingly disingenuous, as the SEC itself has recently allowed Bitcoin futures ETFs, which can be subject to manipulation. Commodities such as lumber and copper are also subject to price manipulation, but these types of ETFs have been permitted. By its very nature, investing is inherently risky, even with entities and securities that are SEC-approved (Madoff, Enron, etc.). It is the American investor's responsibility to make their own decisions and to protect themselves and accept risk, it is not the SEC's job to act overly-paternalistic and seal off exciting new investing frontiers. In addition, American investors investing in Bitcoin now are subject to high fees. By allowing GBTC to become a Bitcoin spot ETF, it will eventually open up the market to competition, which will inherently lower fees, which in turn will help the American investor. GBTC is a well-established and widely-known vehicle, a great entity to become America's first Bitcoin spot ETF. I strongly encourage the SEC to approve GBTC's application and open America's doors to the next generation of investors and the next frontier of investing. Thank you for your consideration, Michael J. King