Oct 13, 2023

Friday is the deadline for the SEC to challenge Grayscale's legal victory, after a court ruled the regulator must review its rejection of Grayscale's attempt to convert GBTC into an exchange-traded fund (ETF).

Video transcript

Today is the deadline for the SEC to challenge Greyscale legal victory after a court ruled the regulator must review its rejection of Grey Scale's attempt to convert G BT C into an ETF. Joining us now to discuss this 21 co co founder and Ceo Hani Rash one. Welcome back, honey. Hello. Hello. Good, good to see you again. Um Arc Investment 21 co subsidiary 21 shares filed for their first potential Bitcoin ETF application again earlier this year. After the second time you did it, it was rebuffed by the SEC. Uh what has to happen now uh for, for this to move forward. So we, we understand the process of approving a spot Bitcoin product is not going to happen overnight. I think one way or another directly or indirectly. I've been personally trying to make this happen with, with my co-founder, with our team since 2018. Uh we remain committed to bringing an efficient, regulated, safe and reliable uh product to market. Uh And we think that towards the um towards the end of this process, uh we start getting uh additional education with the regulators and additional safeguards. We feel like we're making progress and there is light at the end of the tunnel. But, but it's, it's a process and it, uh it takes much longer. I think I said this a few times the regulators in the US just happen to be a lot more public about it. We have public filings, we have public comments and, and things like that. Whereas in other jurisdictions, sometimes it moves just as slowly. Uh, but a lot of this stuff is just behind the scenes. And so we may not be following it as much. Which do you prefer, by the way, do you prefer that it's public or do you prefer that? It's sort of like quiet a little bit and doesn't bring about a lot of skepticism. I think, I think it depends. I'm happy to, I'm happy to go through hell to get this product in the hand of customers at the end of the day. Any Coinbase, institutional analyst thinks that the spot based Bitcoin ETF is already priced in. Do you agree or disagree? Uh based on the inflows that we're seeing, I would disagree a bit. Uh Last week, for example, we saw our second highest day in company history, uh the highest day which was just a couple million more occurred in the uh towards the end of October 2021 when the price of Bitcoin was 62 K. We're starting to see a turn in the market in terms of inflows and activities. And we think part of that is momentum with the US Bitcoin ETF. Part of that is just other things that are happening in the crypto scene. I'm not sure I'm a little bit more than that. It's coming from all over the place, it's coming. So, so 22 big themes. One people have largely held, we haven't seen that many outflows and, and the people that have purchased last year, the year before et cetera have largely held. Um And then we're starting to get either consolidations of positions. Maybe uh maybe people are consolidating towards Bitcoin or E thee and maybe people are putting more money into solo or avalanche, but also from new entrants doing their first uh check. And the good thing about new entrants doing first checks is that typically what we see is a smaller first check and then you learn more about the market, then you become more comfortable and then you deploy more. And so I, I would say it, it looks like this could be the start of something uh over the next 12 to 18 months that leads us somewhere positive. I mean, we would hope so because it's been pretty boring recently, right? I mean, Bitcoin has been pretty boring, the market's been pretty boring. I mean, is there any chance that this could just be like totally anti climactic? Like people have just kind of checked out at this point. It's not the volatile roller coaster we're here for. Right. I uh I do think that there are a lot, uh there are a lot of, of additional factors aside from the US Bitcoin ETF launch here. Uh Part of why inflows are rising is, is frankly a lot of the projects and protocols that have over the last 18 months been making solid progress, finally deploying things. We're seeing friend tech, we're seeing increases in stablecoin use and companies now that are just entirely built off of stablecoins. The US Bitcoin ETF is, is probably a significant, but I would say minority part of, of this rich tapestry of crypto innovations that we're seeing and we're suddenly, I'm not, I'm not saying the bear market ends tomorrow or any time soon, but I do feel that we're starting to maybe smell the beginning of the end. Haney, thanks so much for joining us. Always a pleasure having you on the show. Thanks for having me. I was 21 co co founder and Ceo Haney Rashwan.

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