April 19, 2024
Grayscale in Talks With JPMorgan, Goldman Sachs
Bitcoin News

Grayscale in Talks With JPMorgan, Goldman Sachs

Crypto asset manager Grayscale Investments is reportedly in discussions with major firms, including JPMorgan and Goldman Sachs, for potential involvement in its proposed spot Bitcoin exchange-traded fund (ETF). As of January 4, the price of Bitcoin has ticked down to $42,938.

According to Bloomberg’s report on January 4, Grayscale has engaged in talks with JPMorgan and Goldman Sachs regarding their possible roles in the ETF. This development follows Grayscale’s recent filing of an amended S-3 application with the United States Securities and Exchange Commission (SEC), although the document did not specify any authorized participants.

Simultaneously, another media report suggests that Goldman Sachs is in talks with BlackRock about potentially acting as an authorized participant for BlackRock’s own ETF. BlackRock had previously updated its S-1 filing, naming Jane Street and JPMorgan as authorized participants for its proposed ETF.

Authorized participants play a crucial role in managing an ETF, facilitating the creation and redemption of shares within the fund. While an ETF issuer can name multiple financial firms as authorized participants, they don’t need to disclose this information in their S-1 or S-3 filings.

Despite JPMorgan being named as an authorized participant for several proposed spot Bitcoin ETFs, Goldman Sachs might join the ranks of other Wall Street giants, such as Cantor Fitzgerald and Jane Street, who have been designated authorized participants for various ETF issuers.

Goldman Sachs has traditionally maintained a neutral stance towards cryptocurrencies and the digital asset sector. Matthew McDermott, Goldman’s head of digital assets, expressed in a December 27 interview with Fox Business that the approval of a Bitcoin ETF would contribute to the maturation of the crypto market and attract increased institutional investment into digital assets.

It’s noteworthy that a spot Bitcoin ETF has not yet received approval in the United States. Nonetheless, ETF analysts are optimistic, estimating a 90% likelihood of approval before January 10.

Currently, 14 asset managers are actively seeking approval to issue a spot Bitcoin ETF, providing institutional investors with direct and regulated exposure to Bitcoin in the United States.

Image by Jaydeep Joshi from Pixabay

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