Apr. 27, 2022
Dear SEC, I write to you as a GBTC shareholder, in support of the conversion of Grayscale Bitcoin Trust (OTCQX: GBTC) — the world’s largest publicly-traded cryptocurrency fund — to an ETF. By not approving this conversion, you are not protecting me, the investor – the very person you were appointed to protect. 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. Still further, your failure to approve a spot bitcoin ETF is harming me, as well as other investors, because the absence of a spot bitcoin ETF is exerting an artificially negative pressure on the price of BITCOIN by denying US investors, both private and institutional, a convenient and inexpensive vehicle for investing in BITCOIN. This undoubtedly exerts an artificially negative pressure on the BITCOIN price, to the detriment of the price discovery feature of an efficient market. Acting as an enabler for this type of market inefficiency is particularly damaging to investors in light of the fact that many personal finance, asset managers and macroeconomic experts believe that a small but significant allocation to BITCOIN is essential to a well diversified portfolio. Many experts also believe that BITCOIN is currently the best asset class available for investors to accomplish both growth preservation of wealth under the current adverse market conditions, which could persist for quite some time. Finally, the SEC's current failure to recognize the critical role that BITCOIN can and should play in a well diversified portfolio by approving a spot BITCOIN ETF is emboldening many financial service companies, such as one of my brokers Merill Lynch, to deny their clients even the ability to invest in GBTC. This further artificially lowers the BITCOIN market price and impedes individual investors' ability to have access to the diversifying and other benefits of BITCOIN. Therefore, in my considered opinion, any failure to approve a spot BITCOIN ETF would represent a serious detriment to the very investors the SEC is designed to protect. I am a newly retired US government attorney writing from Mississippi. Thank you for giving me the opportunity to express my view and with the hope that you will approve this conversion and protect the interest of investors. Sincerely, Stephen A. Mixsell Jr.