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Gungun Bhatia
Dec 19, 2022
by Gungun Bhatia

Grayscale Investments to Explore Returning 20% of Investor Capital

Grayscale Investor Capital

Table of contents

  1. Grayscale to Return 20% of Investor Capital
  2. Impact of FTX Collapse
According to an investor letter cited by the Wall Street Journal, Grayscale Investments is considering options to return a fraction of the Investor Capital of its flagship Grayscale Bitcoin (GBTC) product. It is only possible if the Securities and Exchange Commission (SEC) declines to endorse its spot bitcoin exchange-traded fund (ETF).

Grayscale to Return 20% of Investor Capital

The 20% of GBTC shares that are still outstanding and are trading at a 49% discount to net asset value (NAV) might be one alternative, according to the research.

In an earlier brief, the SEC cited a lack of regulatory monitoring as one of the reasons Grayscale's efforts to transform its bitcoin trust into an ETF were repeatedly rejected.

Impact of FTX Collapse

Following a stressful month for the cryptocurrency sector due to the collapse of FTX, one of the biggest exchanges, Grayscale Chief Executive Michael Sonnenshein wrote a letter to investors in an effort to allay their fears.

Grayscale, a subsidiary of CoinDesk, is owned by the Digital Currency Group. Grayscale filed a lawsuit against the SEC in June, claiming that it "vehemently disagreed" with the agency's decision to reject the company's ETF application.

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Cryptocurrency Securities and Exchange Commission (SEC) Grayscale Investments Bitcoin Exchange-Traded Fund (ETF)
Grayscale Investments to Explore Returning 20% of Investor Capital
Gungun Bhatia
Gungun is an enthusiastic writer that likes to create content for various aspects of the blockchain and crypto industry. She carries out extensive research and provides readers with informative and high-quality material.

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