Experts differentiate between BlackRock and Grayscale Bitcoin trusts.

BlackRock recently applied for a Bitcoin ETF with the Securities and Exchange Commission. However, there are differences between BlackRock’s iShares product and the Grayscale Bitcoin Trust (GBTC). For example, BlackRock’s iShares product is technically a trust but allows redemptions similar to an ETF, while the GBTC lacks this function. The key difference between a Bitcoin ETF and a trust is the ability to buy bitcoin at the end of the trading day to bring the fund’s assets in line with its trading price, which only an ETF can do. In contrast, a trust is a fixed portfolio with no ability to adjust its holdings and therefore often trades at a varying premium or discount to its underlying assets’ value. GBTC has been trading at around a 40% discount to net asset value for years, prompting Grayscale to seek SEC approval for a Bitcoin ETF. Grayscale has filed a lawsuit after the SEC rejected the conversion, which is currently playing out in a Washington DC court with a final decision expected later this year. BlackRock’s ETF will adhere to the highest possible standards and will use Coinbase Custody as its custodian. The new iShares Bitcoin Trust will be listed on the Nasdaq exchange. Given BlackRock’s reputation as the world’s largest money manager, with $9.1 trillion of assets under management at the end of the first quarter of the year, the SEC is unlikely to easily reject its application.

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