May. 06, 2022
Dear SEC, I write to you as a long-term GBTC & ETHE 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. I bought into this Trust NOT for trading purposes, but as the only way (at the time) to buy and hold BTC in my retirement account. Subsequent to my purchase, a substantial NAV discount developed in GBTC. The conversion will close the NAV gap and give fund holders, like me, an opportunity to realize a true, non-technical mark on our positions. That you have since approved another Bitcoin ETF, I don’t understand how conversion isn’t a just outcome. Indeed, 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. I’m writing from Atlanta, GA, 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. Sincerely, Michael C. Parsons