Bitcoin Investment Trust Sponsor Launches Ahead of Market Debut
Bitcoin Investment Trust (BIT) has received approval to list on the securities marketplace OTC Markets Group, meaning shares could begin trading as soon as next week.
In preparation for the debut, the private investment vehicle owned by Digital Currency Group (DCG) has announced the launch of Grayscale Investments, which will sponsor the BIT, taking on responsibilities as necessary to register and run the fund.
Commenting on the news, director of sales & business development Michael Sonnenshein laid out a broad vision for the latest entrant in the larger DCG entity, the parent brand for bitcoin products and services spearheaded by founder Barry Silbert.
Sonnenshein told CoinDesk:
"We're trying to establish ourselves as the trusted authority on digital currency investing, and seek to develop a fleet of investable products that will allow people to invest in digital currency."
Sonnenshein indicated that Grayscale's name was inspired by the appearance of a distributed network of nodes at distance.
"As you draw back away from it, it reveals this nice grayscale, it's a mathematical look at it, and it's a name we all really loved," he added.
No set trading time
While certain eligible owners of BIT shares will be able to start trading as soon as next week, Sonnenshein stressed that Grayscale can't predict exactly when this process will begin.
"What is going to be traded are existing shares and those shares are owned by people who have owned them for longer than a year. Having owned them longer than a year, that means they no longer have a restriction on them, but shareholders have to elect to sell those shares," Sonnenshein explained.
The process, he suggested, could take up to several business days, and may be influenced by factors such as the price of the shares when initially purchased, a time close to when bitcoin was trading near peak levels.
Still, Sonnenshein expressed his hope that original shareholders would be willing to sell to satisfy market demand, stating:
"We have no control over how many people chose to sell and chose to buy, that is all market-driven."
Of note on the new Grayscale website may be the lengthy terms and conditions, which include language that articulates the volatile nature of bitcoin, as well as how the fund is not registered with the US Securities and Exchange Commission, a tactical move that allowed it to be first-to-market with a bitcoin investment vehicle.
Addressing concerns these might alienate potential buyers, Sonnenshein stressed that this was concurrent with Grayscale's duties to disclose the risks of the fund alongside its benefits.
"We all know that bitoin is a volatile investment. Like any investment there are those certain disclaimers that we include in our language," he said.
Sonnenshein emphasized the exciting nature of the launch, which he contends will provide a more familiar experience to investors who don't want to go through the friction of buying and storing bitcoin but nonetheless want exposure to the market.
Sonnenshein also provided details about the day-to-day operations at the firm, which is based out of the larger DCG office in New York.
Grayscale, he said, is now hiring to expand its team, which he described as small but looking to grow given the new activity he expects around BIT.
BIT will continue to create restricted shares for sale to eligible investors, while those who don't meet such qualifications will be able to purchase shares through the OTCQX marketplace.
The fund is listed under the symbol GBTC.
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