Osprey Bitcoin Trust eyes sale or merger with ETF to avoid liquidation
Digital asset manager Osprey Funds announced that it may have to liquidate its bitcoin trust if it can't find an exchange-traded fund to rescue it.
"The common units of fractional undivided beneficial interest of the [Osprey Bitcoin BTC -4.15% Trust] are trading at a discount to the value of bitcoin," the company said in a statement. Osprey Funds also stated that it "plans to consider a wide range of options, and is in various discussions about a potential sale of the trust to, or merger with, an existing bitcoin ETF."
If Osprey Funds is unsuccessful it said it will "liquidate and dissolve the trust within 180 days." The firm declined to comment further when asked what ETF providers the firm was in discussions with.
Osprey Funds exploring options with regards to its bitcoin trust comes at a unique time as the price of the world's most popular cryptocurrency briefly hit an all-time on Tuesday, surpassing $69,000. Additionally, spot bitcoin ETFs have been generating billions of dollars in trading volume with the products offered by Grayscale, BlackRock and Fidelity leading the way.
A little more than a year ago, before spot bitcoin ETFs gained approval and started trading, Osprey Funds sued Grayscale , accusing the firm of “misleading” people by saying that its product would be converted to an exchange-traded fund, despite regulators having rejected that as a possibility. Grayscale eventually did convert the fund and it began trading as a spot ETF in January.
