American cryptocurrency investment firm Grayscale is diversifying its spot Bitcoin (BTC) exchange-traded fund (ETF) offering by launching a “spin-off” of its Grayscale Bitcoin Trust ETF (GBTC).
Grayscale officially announced that its Grayscale Bitcoin Mini Trust debuted trading on the electronic securities exchange NYSE Arca at 8 am UTC on July 31.
What is Grayscale Bitcoin Mini Trust?
The Grayscale Bitcoin Mini Trust is positioned as a “spin-off” of the spot Bitcoin ETF that Grayscale started trading in January 2024, following approval from the United States Securities and Exchange Commission (SEC).
The new investment product is now listed on NYSE Arca as a spot Bitcoin exchange-traded product (ETP) under the ticker "BTC.”
Grayscale explained that the Grayscale Bitcoin Mini Trust was established by distributing 10% of GBTC's underlying Bitcoin to BTC, a process they describe as involving innovative mechanics of initial seeding.
The spot Bitcoin ETP begins trading with a net asset value per share of $5.84 and $1.7 billion in assets under management as of July 30.
Grayscale mentioned that the Grayscale Bitcoin Mini Trust is not registered under the Investment Company Act of 1940 and is not subject to regulation under the Investment Company Act of 1940, unlike most mutual funds. The firm added:
“BTC’s distribution event is colloquially known as a ‘spin-off,’ and is a corporate action that is not expected to be a taxable event for GBTC nor any beneficial owner of GBTC shares as of the previously announced record date of July 30, 2024. Investors are encouraged to consult a tax advisor for related tax guidance.”
Grayscale Bitcoin Mini Trust aims to lower barrier to Bitcoin
According to Grayscale’s head of ETFs, David LaValle, the purpose of the Grayscale Bitcoin Mini Trust is to help further lower the barrier to accessing Bitcoin in an SEC-regulated investment vehicle.
Grayscale’s head of strategic partnerships, John Hoffman, highlighted that the Grayscale Bitcoin Mini Trust is the first “mini” Bitcoin ETP launched in the United States. He added:
“With built-in liquidity, a diversified shareholder base, and an accessible share price, BTC is one of the most efficient tools for investors and financial professionals seeking to add low-cost, long-term exposure to Bitcoin to their investment accounts.”
According to the announcement, Grayscale Bitcoin Mini Trust’s fee is 0.15%, while brokerage fees and other expenses may still apply.
