As a seasoned crypto investor with years of rollercoaster rides through the digital asset market, I welcome Grayscale’s decision to streamline their Bitcoin and Ethereum ETFs through reverse share splits. The focus on cost-effectiveness is music to my ears, especially when dealing with volatile assets like Bitcoin and Ethereum.
Grayscale Investments, a major global player in Bitcoin exchange-traded funds (ETFs), is taking steps to lower costs associated with its cryptocurrency ETFs by implementing reverse stock splits.
On November 19th, Grayscale executed a reverse stock split for both of its cryptocurrency exchange-traded funds. These include the Grayscale Bitcoin Mini Trust ETF (BTC) and the Grayscale Ethereum Mini Trust ETF (ETH).
According to Grayscale, the reverse share splits for their ETFs aim to lower the cost associated with trading these securities, making transactions smoother.
Grayscale is always seeking opportunities to develop its product range, aiming to cater to the preferences and requirements of the investment sector. According to input received from our clients, we strongly feel that this move will be advantageous for both our clients and the broader investment community.
Grayscale Bitcoin Mini Trust ETF’s price increased by 5x
After undergoing a reverse stock split at 10:00 pm UTC on Nov. 19, the Grayscale Bitcoin Mini Trust ETF experienced a fivefold rise in its share price. In tandem with this increase, the total number of ETF shares in circulation decreased proportionately.
Furthermore, due to these divisions, investors may now possess partial shares. These fractions are monitored either individually by the investor’s depository trust company (DTC) on their internal records or accumulated for later sale once the total number of fractional shares generated as a result of the split has been determined.
In the event of a sale, shareholders will receive their portion of the net cash based on the fraction of shares they would have owned due to the reverse share split, had they not been rounded down. However, it’s important to note that fractional shares cannot be traded on NYSE Arca, as stated by Grayscale.
10x price increase for Grayscale Ethereum Mini Trust ETF
Due to the reverse stock division of Grayscale Ethereum Mini Trust ETF, each share’s price rose tenfold compared to its previous net asset value (NAV).
Shareholders should reduce their share count by a proportional amount, not considering partial shares.
After the reverse stock split that took place on November 19, shareholders can expect the impact of this action in the trading on the following day, November 20.
In simpler terms, for each group of five Grayscale Bitcoin Mini Trust ETF shares you hold before the split, you’ll receive one share after the split. Importantly, this single post-split share will be worth 5 times more than a pre-split share’s net asset value (NAV).
Currently, before market opening, the price of Grayscale Bitcoin Mini Trust ETF is reportedly $41, based on data from TradingView.
10 units of Grayscale Ethereum Mini Trust ETF’s pre-split Ethereum shares will give you one post-split share, which has a value ten times greater than the pre-split share’s Net Asset Value (NAV) per share. Currently, the fund is trading at $2.90 before market hours, as indicated by TradingView.
As per Grayscale’s statement, no action is required from shareholders regarding the share splits since these adjustments will occur automatically.
“Importantly, your holdings will remain unchanged,” Grayscale stated.
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2024-11-20 16:42