ETF.com: Your product, the Grayscale Bitcoin Trust (GBTC), looks like it’s been trading pretty consistently at a premium to its net asset value. Is that a concern for new investors who want to get exposure to bitcoin through the trust? Should they worry about the premium, which last stood around 36%?
Sonnenshein: GBTC can be purchased through private placements periodically to accredited investors, but the price in which GBTC is quoted each day in the OTC market is subject to market forces (read: Be Wary Of This Skyrocketing Fund).
The fact that it’s traded with such depth and so much liquidity is compelling evidence of how much demand there is for exposure to bitcoin through a security, much the same way a product like the SPDR Gold Trust (GLD) has provided investors with the ability to gain exposure to gold through a security.
These days, it’s among the top three or five most actively traded securities on the OTC market. Its pricing is always going to be dictated by the market, depending on how much demand there is for it.
ETF.com: What’s your take on the bitcoin ETF saga? Your firm had an application for a bitcoin ETF outstanding, but it was withdrawn. The SEC continues to reject any bitcoin ETFs from coming to market. Do you see that changing anytime soon?
Sonnenshein: The regulators have been very open-minded about the digital asset space, and have done a very good job of engaging with the communities. Grayscale, as the largest asset manager in the space, is often engaging with regulators and serving as a resource to them.
It’s a “time will tell” kind of a thing. But we applaud regulators for engaging with this community rather than shying away from it.