Grayscale's Michael Sonnenshein contends that the nugget manager's contempo Form 10 filing with American regulators would exist "a milestone" for the crypto manufacture if it'due south approved.

Sonnenshein — managing managing director at the world's largest digital nugget manager, Grayscale Investments — made his remarks during an interview with CNBC on November. 20.

Hedge funds subsequently digital asset exposure

Before this week, Grayscale filed a registration statement on Grade ten for its publicly traded Bitcoin (BTC) fund Grayscale Bitcoin Trust (GBTC) with the United States Securities and Exchange Commission (SEC).

If approved, the trust would go the starting time cryptocurrency investment vehicle to attain the status of a reporting company by the SEC. In his interview with CNBC, Sonnenshein noted the robust institutional involvement in cryptocurrency access products. Even simply in Q3 2019, he said:

"84% of inflows were from non-crypto hedge funds that want digital nugget exposure."

GBTC has been trading since May 2015 and Sonnenshein noted that "if we merely expect at the last iii-calendar month trading book, it's tripled year-over-yr," regardless of Bitcoin's performance on the spot markets.

Regarding the significance of the SEC potentially giving the green calorie-free to Grayscale'south Grade 10 filing, Sonnenshein said:

"You lot have a lot of companies that desire to have exposure to the infinite, only then you kickoff to ask, who at the company is going to have the keys? Who at the company is going to do the due diligence and the ongoing compliance?"

Aside from compliance benefits, he emphasized the importance of creating a family of products that "look and feel similar many of the other instruments these institutions use."

Halving, non institutions, volition drive Bitcoin'south price

The takeaway, he suggested, is that if Form 10 is accounted to be effective, we'll see for the offset time "greater access for institutions who demand an SEC reporting company to be able to invest" and "quicker liquidity options, so that investors can divulge their holdings afterward vi, as opposed to twelve, months."

Regarding any potential impact on Bitcoin's price, Sonnenshein discarded the institutional investor adoption narrative and emphasized instead Bitcoin's forthcoming halving — and consequent diminishment of supply — as a factor that has historically shown itself to take a positive impact on the asset'south toll.

As reported, Grayscale's regulatory foray follows a record year for the trust, which saw inflows of $254 million in total investment into its products in the third quarter of 2019.