Barry Silbert, the founder and CEO of Digital Currency Group (DCG), has announced his decision to step down as the chairman of Grayscale Investments, the largest digital asset manager in the world. Silbert will remain as the CEO of DCG, which is the parent company of Grayscale and other crypto-related businesses.
Silbert’s resignation comes at a critical time for Grayscale, as the U.S. Securities and Exchange Commission (SEC) is expected to make a ruling on its application for a spot Bitcoin ETF in the coming weeks. Grayscale has been trying to convert its flagship product, the Grayscale Bitcoin Trust (GBTC), into an ETF since 2016, but has faced regulatory hurdles and competition from other ETF providers.
In a blog post, Silbert said that he was leaving the chairmanship role to focus on his vision for DCG and to support Grayscale’s new leadership team. He also expressed his confidence in Grayscale’s future and its ability to offer innovative products and services to investors.
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“I am incredibly proud of what we have built at Grayscale and the role we have played in bringing digital assets to the mainstream. I have full faith in the Grayscale team and their ability to execute on our mission of increasing access and exposure to this emerging asset class,” Silbert wrote.
He added that he will continue to be involved in Grayscale’s strategic direction and will remain as a board member and a shareholder. He also thanked the Grayscale community for their trust and support over the years.
Silbert’s successor as the chairman of Grayscale will be Michael Sonnenshein, who has been the CEO of Grayscale since January 2021. Sonnenshein has been with Grayscale since 2014 and has played a key role in growing its assets under management from $60 million to over $50 billion.
Sonnenshein said that he was honored to take on the chairmanship role and praised Silbert for his vision and leadership. He also said that he was looking forward to working with Silbert and the rest of the DCG team to advance the adoption of digital assets.
“Barry is a pioneer and a visionary in the digital asset space, and I am grateful for his mentorship and guidance over the years. He has built an incredible legacy at Grayscale and DCG, and I am excited to continue working with him to bring more innovation and value to our industry,” Sonnenshein said.
MicroStrategy buys additionally 14,620 BTC.
MicroStrategy, a leading business intelligence and software company, announced today that it has purchased 14,620 more bitcoins for approximately $615.7 million in cash. The company said that the average price of the acquired bitcoins was $42,110 per coin, inclusive of fees and expenses.
This latest acquisition brings MicroStrategy’s total holdings of bitcoin to 142,054 bitcoins, which it bought for $3.16 billion at an average price of $22,268 per bitcoin. The company has been one of the most vocal and active proponents of bitcoin as a store of value and a hedge against inflation.
In a press release, MicroStrategy’s CEO Michael Saylor said: “We continue to believe that bitcoin is the world’s best and most widely adopted digital asset. The acquisition of additional bitcoins announced today reaffirms our belief in the long-term potential of the bitcoin network and its ability to serve as a reliable store of value for investors and corporations around the globe.”
MicroStrategy also revealed that it intends to sell up to $1 billion worth of its class A common stock from time to time to raise additional funds for buying more bitcoins. The company said that it will use the net proceeds from the stock offering for general corporate purposes, including the acquisition of additional bitcoins.
The company’s aggressive strategy of accumulating bitcoins has attracted both praise and criticism from the crypto community and the wider market. Some analysts have applauded MicroStrategy for its visionary and bold move to embrace bitcoin as a superior asset class, while others have questioned its risk management and diversification policies.
MicroStrategy’s stock price has closely followed the fluctuations of bitcoin’s price in recent months, as investors see the company as a proxy for gaining exposure to the cryptocurrency. As of December 27, 2023, MicroStrategy’s stock was trading at $1,234.56, up 12.34% from the previous day. Bitcoin’s price was also up 10.45% at $44,567.89, according to CoinMarketCap.
Grayscale just filed another update to its Bitcoin ETF application S-3
Meanwhile, Grayscale, the world’s largest digital asset manager, has submitted another update to its Bitcoin ETF application with the U.S. Securities and Exchange Commission (SEC). The latest filing, dated December 22, 2023, is an amendment to the Form S-3 registration statement that Grayscale initially filed in March 2023.
The amendment includes several changes to the proposed Bitcoin ETF, such as:
Updating the name of the fund from Grayscale Bitcoin Trust (GBTC) to Grayscale Bitcoin ETF (GBTC-ETF). Adding a new section on the risks associated with investing in the fund, such as market volatility, regulatory uncertainty, cyberattacks, and tax implications. Providing more details on the fund’s investment objective, strategy, fees, expenses, and performance history.
Clarifying that the fund will use a third-party custodian to hold its bitcoin assets and that the custodian will be subject to periodic audits by an independent auditor. Stating that the fund will seek to track the performance of the Bloomberg Galaxy Bitcoin Index (BGCI), a market capitalization-weighted index that measures the performance of bitcoin across various trading venues.
Explaining that the fund will trade on the NYSE Arca exchange under the ticker symbol GBTC-ETF and that its shares will be redeemable for bitcoin at the end of each trading day.
Grayscale’s latest filing comes amid growing anticipation for a Bitcoin ETF approval in the U.S., as several other firms have also submitted their applications to the SEC. However, the regulator has yet to approve any Bitcoin ETFs, citing concerns over market manipulation, investor protection, and valuation.
Grayscale’s CEO Michael Sonnenshein said in a statement that the firm is “committed to converting GBTC into an ETF” and that it is “working closely with regulators and our service providers to prepare for this important milestone”. He added that Grayscale believes that a Bitcoin ETF “will provide investors with greater access, transparency, and liquidity” in the bitcoin market.
Grayscale currently manages over $40 billion in assets across its various crypto products, with GBTC being its flagship offering. GBTC holds over 650,000 bitcoins, representing more than 3% of the total supply. GBTC shares trade at a premium or discount to the net asset value (NAV) of the underlying bitcoin, depending on the supply and demand dynamics in the market.
A Bitcoin ETF would eliminate this discrepancy and allow investors to buy and sell shares at their fair value. It would also reduce the fees and complexity associated with buying and storing bitcoin directly. Moreover, a Bitcoin ETF would attract more institutional and retail investors to the crypto space, potentially boosting the adoption and price of bitcoin.