It has become quite apparent that in the US, the SEC is a key regulator when it comes to getting cryptocurrency products right. The quest for a Bitcoin ETF remains, with the SEC being the hardline gatekeeper there.
However, on the other side of things, one powerful institutional Bitcoin investment company is looking to take its position further. Grayscale Bitcoin Trust, which emerged all the way back in 2013 as a tool for institutional investors to get their taste of Bitcoin, is now looking to break new ground with the SEC.
The company has publicly filed a Registration Statement on Form 10 with the SEC. This is a voluntary filing that, if deemed effective, would designate the Trust as an SEC reporting company and register its shares pursuant to Section 12(g) of the Securities Exchange Act of 1934.
This is a big step as it would make the Trust as the first digital currency investment vehicle to attain the status of a reporting company by the SEC.
Grayscale, especially in the early days when institutional interesting Bitcoin was relatively low, was met with a lot of skepticism by traditional investors. But its early foot in the door has allowed it to reach prime status as an investment product tied to Bitcoin.
However, Grayscale is also at pains to point out that this is not an application towards a Bitcoin ETF, and even though the Greyscale product has similar functionality, the company is not intending on going down that path.
Yet, there are some pretty decent pluses should this application be successful.
Firstly, it would allow the Trust to be designated as an SEC reporting company and register its shares pursuant to the Exchange Act. This would be a first in the crypto space; not only good for the Trust, but also for the relations between the SEC and the rest of the industry.
More so, it would help with liquidity as the statutory holding period of their private placement shares would be reduced from 12 to 6 months; it would also attract a broader audience through SEC compliance, but another big one would be that the Trust would file its quarterly and annual reports as well as audited financial statements as 10-Qs and 10-Ks with the SEC.
People still have mixed feelings about the Grayscale Trust, but its decision to approach the SEC and try and abide by its rules will only be of benefit to the cryptocurrency industry. The more the SEC can see compliance tied to Bitcoin-related companies, the better it will be when major adoption kicks off.