In a Dec. 28 statement, Valkyrie Investments announced that it has submitted a proposal to become the sponsor and manager of Grayscale’s Bitcoin Trust.
Grayscale BTC (GBTC) is one of the largest Bitcoin investment funds, with a current market capitalization of 643,572 BTC ($10.6 billion). However, the fund is in trouble as well: in December, GBTC traded at half the value of the Bitcoin that it holds.
Valkyrie stated that it intends to improve on Grayscale BTC with a variety of changes. It claims to aim for orderly redemptions at net asset value (NAV), allowing customers to withdraw their funds at a fair value without difficulty. In addition, the company intends to reduce GBTC fees and provide redemption options in both Bitcoin and cash.
The company also announced the launch of the Valkyrie Opportunistic Fund LP, which will capitalize on the difference between GBTC and the NAV.
Valkyrie stated that its proposal is a “significant improvement over the current management of GBTC,” and it requested that Grayscale “consider it carefully.”
Grayscale, on the other hand, has its own plans. The firm intends to convert GBTC into an ETF in order to increase the fund’s price, though previous attempts have failed due to SEC rejections in the United States. According to recent WSJ reports, Grayscale has also suggested other options, including a tender offer for up to 20% of outstanding shares.
Valkyrie stated today that it has a “proven track record of success” with its own Bitcoin Trust, which has had daily liquidity since January 1, 2021.
The company also announced the launch of several Bitcoin-related ETFs. Along with VanEck and ProShares, the company was one of three to launch the first Bitcoin futures ETFs in late 2021. Since then, other firms have launched Bitcoin futures ETFs.
Valkyrie has also been making headlines for another reason in recent weeks. Coindesk revealed that TRON founder Justin Sun is one of Valkyrie’s largest investors shortly before Valkyrie announced its intention to manage GBTC.
It’s unclear whether Sun has any direct influence over Valkyrie, and if so, whether he has any reason to encourage or discourage it from collaborating with Grayscale.
