Bitcoin, Ethereum ETF reshaped: Grayscale finalizes reverse share splits

• Grayscale implemented reverse share splits of Bitcoin and Ethereum ETF.
• Options trading for the firm’s BTC ETFs will start today. 

Grayscale Investments, a digital currency asset manager, has finalized reverse share splits for its Bitcoin [BTC] Mini Trust ETF (BTC) and Ethereum [ETH] Mini Trust ETF. 

The changes took effect on the 20th of November, following the reverse share splits executed the previous evening.

David LaValle, Grayscale’s Global Head of ETFs, stated in a recent blog post,  

“Based on feedback from our clients, we believe this is the right decision and beneficial to our clients and the investment community.”

For context, a reverse share split combines several shares into one, reducing total shares but raising the share price.

Implications of the reverse share split 

The firm noted the advantages of reverse share splits, emphasizing their ability to streamline trading and make it more “cost-effective” for market participants. 

As a result of this latest move, Grayscale Ethereum Mini Trust ETF underwent a 1:10 reverse share split. 

This increased the price per share to 10 times its pre-split net asset value (NAV) while reducing the number of shares outstanding proportionately. 

Similarly, Grayscale Bitcoin Mini Trust ETF executed a 1:5 reverse split, raising the price per share to five times its pre-split NAV with a corresponding decrease in shares outstanding.

Source: Grayscale

However, the asset manager highlighted that the shareholders may find themselves holding fractional shares post-split. 

Depending on their Depository Trust Company (DTC) participant’s policies, these fractional shares can either be tracked internally or aggregated and sold, with shareholders receiving cash proceeds.

Notably, fractional shares are ineligible for trading on the NYSE Arca.

Grayscale’s Bitcoin and Ethereum ETF performance

Following the split, the firm’s ETFs for Bitcoin and Ethereum showed mixed performance, according to Yahoo Finance. 

The Bitcoin Mini Trust ETF closed at $41.84, marking a 1.80% increase during regular trading hours. 

On the other hand, the Ethereum Mini Trust ended at $28.93, representing a depreciation of 0.92%. However, it saw a pre-market rise to $29.58, gaining 2.25%.

BTC ETF options begin trading

The reverse share splits precede a major development for the firm. Grayscale is set to launch the Bitcoin ETF options for its Grayscale Bitcoin Trust (GBTC) the Mini Trust on the 21st of November, marking a significant expansion in the U.S. market.

The asset manager shared its excitement about this milestone in a recent post on X.

Source: Grayscale/X

This move comes on the heels of BlackRock’s IBIT options debut, which saw nearly $1.9 billion in trading volume on its opening day.