Grayscale Investments is set to launch a new exchange-traded fund (ETF) by spinning off 10% of its Grayscale Bitcoin Trust (GBTC). The new fund, called Grayscale Bitcoin Mini Trust (BTC), aims to start trading on the NYSE Arca exchange by July 31, pending regulatory approval.
Details of the New Fund
Grayscale plans to transfer 10% of the Bitcoin held by GBTC to the new Mini Trust ETF. Existing GBTC shareholders will receive proportional shares in the Mini Trust, ensuring they maintain their overall Bitcoin exposure through both funds.
This strategy mirrors Grayscale’s approach with its Ethereum Trust earlier this month. The company created the Grayscale Ethereum Mini Trust (ETH) using the same spin-off model.
Also Read: SEC Shifts Stance on Bitcoin ETFs After Grayscale Legal Battle
Potential Benefits for Investors
Bloomberg ETF Analyst James Seyffart predicts significantly lower management fees for the Bitcoin Mini Trust compared to GBTC’s current 1.5% annual fee. This expectation is based on the new Ethereum Mini Trust’s fee of 0.15%, a notable decrease from its predecessor’s 2.5% fee. Seyffart elaborated on the potential impact:
“From a value point of view — say a theoretical person has $1,000 in ETHE or GBTC. After the spinoffs occur, it should essentially be $900 in the original fund and $100 in the new mini ETFs.”
This move helps investors maintain exposure while potentially lowering their fee costs.
Background on GBTC
Launched in 2013, GBTC is one of the longest-running spot Bitcoin funds in the U.S., managing over $17 billion in assets. Its Ethereum counterpart began in 2017, following similar successful principles.
By offering the new Mini Trust ETFs, Grayscale aims to provide investors with cost-effective options to gain exposure to leading cryptocurrencies.
