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Speaker 1: We want to go back to the World Economic Form

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Speaker 1: and Davos. We're joined now by Michael Sean and Sein

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Speaker 1: Grayscale Investments CEO. No better person to talk to in

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Speaker 1: relation to this conversation. Hey, Michael, let's just start straight

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Speaker 1: up with flows. We've seen about half a billion dollars

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Speaker 1: pulled out of the Grayscale Bitcoin Trust just in the

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Speaker 1: last six a week or so. Do that surprise you?

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Speaker 1: Does that worry you? What do you make of that?

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Speaker 2: Well, first of all, it's great to be back and

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Speaker 2: thank you so much for having me. Great to be

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Speaker 2: joining you guys from Davos. You know, I think when

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Speaker 2: we look at how GBTC came to market, it was

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Speaker 2: a really differentiated approach. It came to market with twenty

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Speaker 2: eight billion dollars of assets under management, really tight trading spreads,

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Speaker 2: a very diversified base of investors, and ten years of

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Speaker 2: you know, operating history. And so I think with a

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Speaker 2: fund of this size, you know, it's the second largest

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Speaker 2: commodity ETF in the world. You know, we're certainly not

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Speaker 2: surprised to see some of the flows in the product

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Speaker 2: over the first couple of days. And more importantly, rather

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Speaker 2: than using flows as a measure. We're actually looking at

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Speaker 2: trading volumes. The first day that g BTC traded on NYC,

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Speaker 2: it was the ninth most actively traded ETF in the US,

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Speaker 2: So some really staggering numbers for gbtc's debut.

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Speaker 3: Yeah, volumes can be in allround. Michael. It's gay great

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Speaker 3: to see you, Thanks for stopping by. Look, one of

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Speaker 3: the things people are pointing to with you, guys, is

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Speaker 3: you still got relatively high face. So of your new

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Speaker 3: competitors don't how you got to square that circle.

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Speaker 2: Well, again, I think it comes down to investors having choice.

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Speaker 2: The reception we've heard from the investment community is really

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Speaker 2: one of really thanking Grayscale, thanking GBTC for forging a

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Speaker 2: path for these other products to come to market. GBTC,

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Speaker 2: you know, paved the way through our SEC lawsuit, our

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Speaker 2: SEC victory, and ultimately really over the last ten years

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Speaker 2: developing the disclosures and the operations and the mechanics that

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Speaker 2: now other asset managers and other issuers get to borrow from.

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Speaker 2: Now that being said, we're meeting investors where you know,

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Speaker 2: they're trying to invest, and I think that from a

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Speaker 2: market perspective, gbt fee really does differentiate itself by those factors,

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Speaker 2: the size of the liquidity, the track record.

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Speaker 1: Totally get that. Is it worth one hundred basis points?

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Speaker 2: We certainly think it is. I think for an asset

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Speaker 2: class like crypto. A lot of people are pointing to

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Speaker 2: the fact that some new entrants are coming into the space,

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Speaker 2: some of the world's largest asset managers, but this is

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Speaker 2: their first time dealing in crypto assets, operating crypto investment vehicles,

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Speaker 2: and so as an investor, when you're choosing amongst these products,

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Speaker 2: fee is a consideration. The asset manager, the issuer behind

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Speaker 2: it is a consideration. But so should size liquidity. And

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Speaker 2: again that track record, Michael.

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Speaker 3: So much anticipation over so many years. Was it worth

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Speaker 3: the white.

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Speaker 2: Absolutely, it was worth the weight. You know, if you're

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Speaker 2: gonna ask me that question, I'm going to take this

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Speaker 2: moment to once again thank investors for supporting us along

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Speaker 2: the journey, supporting folks like you, guys who've been helping

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Speaker 2: us tell the story over the years. This is such

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Speaker 2: a milestone, This is such an inflection point, and to

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Speaker 2: you know, have that milestone OCRD last week and now

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Speaker 2: be able to come to Davos, the following week and

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Speaker 2: elevate the conversation around crypto with some of the world's leaders.

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Speaker 2: That's what we're here to do, to elevate GBTC and

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Speaker 2: broader understanding of crypto.

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Speaker 1: So you've also been looking into a new covered call

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Speaker 1: fund that you're looking to offer as well. What's the

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Speaker 1: rationale behind that. Is that to keep existing money or

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Speaker 1: is it to draw in new money.

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Speaker 2: Well, one of the big benefits to investors that we're

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Speaker 2: eager to get to now that GBTC is on what

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Speaker 2: NYC is the fact that we're looking forward to having

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Speaker 2: options traded on GBTC on the OTC market, where the

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Speaker 2: fund has been since twenty fifteen, there are no listed

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Speaker 2: options and so for a lot of investors, they're eager

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Speaker 2: to start having options to manage their positions and being

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Speaker 2: able to offer, for instance, a covered call strategy may

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Speaker 2: allow some investors to have passive long GBTC exposure but

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Speaker 2: also earn some additional income. So that is a product

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Speaker 2: we filed for, and I think it really underscores our

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Speaker 2: commitment not just to GBTC, but to crypto more broadly.

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Speaker 2: We want to surround the ecosystem GBTC to create an

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Speaker 2: even more robust environment.

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Speaker 3: You could argue, Michael, but that strategy is premised on

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Speaker 3: the idea that we are going to see maybe significantly

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Speaker 3: less movements in bitcoin price and we're going to see

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Speaker 3: significantly less volatility. Is that effectively what you're pointing to

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Speaker 3: with this this product, and is that a good thing

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Speaker 3: or a bad thing? Yeah?

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Speaker 2: I don't think it's really for us so much a

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Speaker 2: measure of volatility, but instead that we've heard directly from

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Speaker 2: investors they want to passively belong this asset class. They

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Speaker 2: believe that it's still early days for crypto. They want

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Speaker 2: to see that price appreciation, and if they can earn

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Speaker 2: some yield in order, you know, to maximize their returns,

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Speaker 2: then that's a product that they'd potentially be interested in

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Speaker 2: investing in.

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Speaker 1: Michael, I know you're going to talk the book on

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Speaker 1: this one, but there's eleven ETFs out there, maybe a

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Speaker 1: couple more coming in, so maybe let's say thirteen. How

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Speaker 1: many do you think realistically we're going to see in

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Speaker 1: the next couple of years.

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Speaker 2: Well, I think that we're honestly at the beginning of

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Speaker 2: the life cycle of where crypto assets are going to be,

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Speaker 2: certainly in the us. Now that we have spotditcoin ETFs,

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Speaker 2: they're now firmly weaving bitcoin into the fabric of the

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Speaker 2: financial system. Over time, I do think as the dust settles,

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Speaker 2: after a lot of the anticipation that's been built up

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Speaker 2: around these products coming to market, you will ultimately see

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Speaker 2: a couple of products that attain you know, a certain

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Speaker 2: size where they have you know, a track record, a

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Speaker 2: certain asset base, a certain investor base alongside GBTC. So

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Speaker 2: do we ultimately need eleven, twelve, thirteen, you know, spot daitcoin, ETFs. No,

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Speaker 2: But should investors still have choice amongst several products?

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Speaker 3: Absolutely, Michael, thanks for stopping by, really appreciate it, totally

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Speaker 3: understand why you're in Davos for a victory lap. All

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Speaker 3: I would say is Jamie Diamond apparently off limits. He

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Speaker 3: doesn't want to talk about it. Bitcoin is so the way.

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Speaker 2: Jamie said he does. Jamie said, doesn't want to talk

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Speaker 2: about it anymore, but I'd be happy to chat with

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Speaker 2: him any time he likes, no doubt, I think.

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Speaker 3: I'm absolutely certain of great to see you, Michael, Thanks

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Speaker 3: very much. Indeed, Michael sholden Steak of Gray Scale, this

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Speaker 3: is Bloomberg