Asset manager Grayscale Investments has filed with the US Securities and Exchange Commission (SEC) to launch a BNB exchange-traded fund (ETF). This move underscores the investment giant’s intention to expand its digital asset investment products beyond Bitcoin and Ether, exploring more large-cap altcoins.
Currently, Grayscale boasts multiple exchange-traded funds, tracking the value of cryptocurrencies like Bitcoin, Ethereum, Solana, XRP, and Dogecoin. If approved, Grayscale’s BNB ETF will join this list with a Nasdaq listing under the ticker GBNB.
Unveiling Grayscale’s SEC Filing for BNB ETF
Just minutes ago, Grayscale Investments, a prominent asset management company, submitted an application with the US SEC seeking approval to launch a BNB ETF. According to the prospectus, the Grayscale ETF will hold BNB directly, with each share representing a fractional, undivided beneficial interest in the trust’s holdings.
While the shares do not constitute direct ownership of BNB, the asset manager stated that the product is intended to offer investors a “cost-effective and convenient” way to gain exposure to BNB through traditional brokerage accounts.
How the BNB ETF Will Work?
Grayscale’s BNB ETF will create and redeem shares in large bundles of 10,000, called “baskets,” which can only be handled by approved institutional partners known as authorised participants. Nasdaq has cleared the fund to allow these partners to swap BNB directly for ETF shares. They can swap them directly instead of using cash, though cash transactions will also be allowed.
The platform further stated that major firms will manage the ETF’s operations. Coinbase will handle trading services and securely store the BNB held by the fund. Similarly, Bank of New Mellon will oversee administration and share transfers. Meanwhile, CSC Delaware Trust Company will act as the trustee, ensuring the trust operates as intended.
The filing also allows the ETF to earn extra BNB through staking. Any rewards earned this way would be added to the fund’s holdings, which could help boost returns for investors.
A Broader Push for ETFs
Significantly, Grayscale’s BNB filing comes amid the rise of interest in altcoin ETFs among major investment giants. Asset managers like Grayscale, BlackRock, Canary Capital, Franklin Templeton, and Bitwise are pushing to expand crypto ETFs in the US. This surge in demand is followed by the successful launch and acceptance of Bitcoin and Ethereum ETFs.
If approved, this BNB ETF will be among the first regulated products to give investors direct exposure to BNB, which could attract greater interest from institutional players.
For Grayscale, this BNB ETF helps expand its range of products and tap into demand for major altcoins beyond Bitcoin and Ether. The product will also help investors and enthusiasts with an easier and direct way to access BNB without the hassles of wallets, private keys, or crypto exchanges.
Exploring Regulatory Hurdles
The biggest obstacle for the ETF is the SEC’s view on whether the token should be classified as a security under US law. In past lawsuits against crypto exchanges, the regulator has claimed that Binance Coin is an unregistered security.
Grayscale is expected to push back on this assertion, arguing that BNB is a non-security. The company asserts that BNB is mainly used within a decentralized blockchain network rather than an investment contract.
