Key Points
- Grayscale Investments has implemented reverse share splits for its Bitcoin and Ethereum Mini Trust ETFs.
- The firm’s Bitcoin ETF options trading will commence on the 21st of November.
Grayscale Investments, a well-known digital asset manager, has completed reverse share splits for its Bitcoin (BTC) Mini Trust ETF and Ethereum (ETH) Mini Trust ETF. The changes were effective from the 20th of November.
David LaValle, Grayscale’s Global Head of ETFs, mentioned in a blog post that this decision was made based on client feedback and would benefit the investment community.
Understanding Reverse Share Splits
A reverse share split involves combining multiple shares into a single one, which increases the share price while reducing the total number of shares.
Grayscale pointed out the benefits of reverse share splits, including streamlining trading and making it more cost-effective for market participants.
The Grayscale Ethereum Mini Trust ETF underwent a 1:10 reverse share split, raising the price per share to 10 times its pre-split net asset value (NAV) and proportionately reducing the number of shares.
Similarly, the Grayscale Bitcoin Mini Trust ETF carried out a 1:5 reverse split, increasing the price per share to five times its pre-split NAV and decreasing the number of shares.
However, Grayscale noted that post-split, shareholders may end up with fractional shares. These cannot be traded on the NYSE Arca and can either be tracked internally or aggregated and sold, depending on the policies of their Depository Trust Company (DTC) participant.
Performance of Grayscale’s Bitcoin and Ethereum ETFs
After the split, Grayscale’s Bitcoin and Ethereum ETFs showed varied performance. The Bitcoin Mini Trust ETF closed at $41.84, marking a 1.80% increase during regular trading hours.
In contrast, the Ethereum Mini Trust closed at $28.93, indicating a depreciation of 0.92%. However, it saw a pre-market rise to $29.58, gaining 2.25%.
The reverse share splits come before a significant development for Grayscale. The firm is set to start options trading for its Bitcoin ETFs on the 21st of November.
This development follows BlackRock’s IBIT options debut, which saw nearly $1.9 billion in trading volume on its opening day.
