Crypto asset manager Valkyrie Investments plans to sponsor and manage Grayscale Bitcoin Trust

Crypto asset manager Valkyrie Investments aims to become a sponsor and manager of the Grayscale Bitcoin Trust (GBTC), the company announced in a blog post this week.

Valkyrie, one of Grayscale’s competitors, previously launched a Bitcoin Trust and a Bitcoin-related exchange-traded fund (ETF) in 2021. As part of its plan to sponsor GBTC, the world’s largest Bitcoin fund, the Tennessee-based company also announced the launch of a new fund, the Valkyrie Opportunistic Fund, LP, which seeks to match GBTC’s discount to the value of its underlying lying bitcoin, the company said.

Valkyrie’s plan would be quite a challenge given that GBTC alone has over $10 billion in assets and Valkyrie only has about $180 million in total assets under management.

“We understand that Grayscale has played an important role in the development and growth of the Bitcoin ecosystem with the launch of GBTC, and we respect the team and the work they have done,” Valkyrie said. “However, in light of recent events surrounding Grayscale and its family of associated companies, it is time for a change.”

Grayscale and CoinDesk are both owned by Digital Currency Group.

In its proposal, Valkyrie said it wants to make GBTC redemptions at net asset value (NAV) easier for investors through a Regulation M filing. It also proposes lowering fees to 75 basis points from the current 200 basis points and offering redemptions in both bitcoin and cash.

Earlier this month, GBTC shares reached a record discount rate of over 50% relative to the Bitcoin (BTC) price. GBTC’s recent struggles were prompted by the Security and Exchange Commission’s (SEC) repeated rationale for denying Grayscale Investment’s application to convert GBTC into a spot bitcoin ETF. Grayscale called the initial rejection “arbitrary, moody, and discriminatory.”

Grayscale did not immediately respond to a request for comment.

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