Grayscale Investments LLC announced on Tuesday that the BNY Mellon bank (The Bank Of New York Mellon Corporation) has been chosen as the Grayscale Bitcoin Trust's asset service provider. The news comes as the cryptocurrency firm prepares to convert its Bitcoin fund into an Exchange-Traded Fund (ETF).
Based on their agreement, BNY Mellon bank will begin handling accounting and administrative services for the Grayscale Bitcoin Trust (GBTC) on October 1. Grayscale will use BNY Mellon for ETF services following the conversion of its $21.5 billion GBTC, according to Bloomberg, citing a Tuesday statement.
According to Michael Sonnenshein, CEO of Grayscale Investments, such roles are currently performed in-house. “Our company has been undertaking any and all initiatives we possibly can to prepare this product for an ETF conversion,” Sonnenshein told Bloomberg.
Mellon Bank will also provide transfer agency and ETF services once the Bitcoin trust is converted into an ETF, according to the crypto firm. Such a product would necessitate a variety of backend services, and the agreement asks the bank to provide such critical functions for the crypto company.
Grayscales' latest announcement comes just 24 hours after the firm received SEC approval for its diversified crypto fund (Digital Large Cap fund), making the fund an SEC reporting company.
Grayscale Digital Large Cap Fund would now file its financial statements and other reports with the SEC, as well as comply with all other Securities Exchange Act obligations. The announcement brought the crypto firm one step closer to converting its Bitcoin trust into America's first Bitcoin ETF.
BNY Mellon has also become increasingly involved in the cryptocurrency industry in recent months. The bank began offering Bitcoin custody services to its clients in February.
Meanwhile, nearly 40,000 Bitcoins in Grayscale Bitcoin Trust are being unlocked this week, which could have an impact on the crypto market. An analyst expressed his opinion on whether GBTC would be bullish or bearish for the Bitcoin market. ARK36's executive director, Ulrik K.Lykke, stated: "The unlocking of GBTC shares should have no direct impact on the Bitcoin spot market, in theory. However, if all investors holding the currently locked-up shares rushed to exit their investment at the end of the lockup and began mass selling their shares, the BTC price would most likely fall."
