Grayscale Files for Bitcoin Covered Call ETF Amid Growing ETF Sector

Digital asset management firm Grayscale has submitted a filing with the U.S. Securities and Exchange Commission (SEC) for a Bitcoin covered call ETF, following recent reports.

Strategic Move:

Grayscale's move involves a covered call writing strategy, enabling investors to sell call options on Bitcoin for added income and risk hedging.

Source: SEC Filing

Investment Approach:

The filing clarifies that the fund won't directly invest in Bitcoin but aims to achieve its objectives through actively-managed exposure to Grayscale Bitcoin Trust (GBTC). The fund will engage in the purchase and sale of call and put option contracts utilizing GBTC as the reference asset.

SEC Verdict Influence:

The filing coincides with SEC Chairman Gary Gensler's acknowledgment that the Grayscale versus SEC lawsuit influenced the approval of spot Bitcoin ETFs. Gensler emphasized the need for a more transparent explanation in disapproving Grayscale's proposed ETP.

ETF Trading Surge:

Spot Bitcoin ETFs, approved following the lawsuit verdict, have quickly gained traction, accumulating a total trading volume of $4 billion. Grayscale leads with a substantial 45% of the trading volume share, followed by investment management giant Blackrock.

In summary, Grayscale's move into the Bitcoin covered call ETF space aligns with the growing trend in the ETF sector. The filing emphasizes active exposure to GBTC, and the recent SEC decision on spot Bitcoin ETFs has already led to significant trading activity.