On August 27, Bitwise announced the acquisition of Osprey Bitcoin Trust (OBTC), aiming to expand its market share and offer better terms to investors.
The Deal and Its Terms
On August 27, Bitwise, a prominent U.S.-based crypto asset management company, announced its acquisition of Osprey Bitcoin Trust (OBTC), a smaller competing investment fund. Under the terms of this acquisition, OBTC shareholders will receive shares of the Bitwise Bitcoin ETF (BITB) as part of the liquidation distribution. For existing BITB shareholders, this transaction will not affect their holdings.
Features of OBTC and Benefits for Investors
OBTC, with assets worth $120 million, operates similarly to the pre-ETF format of Grayscale’s Bitcoin Investment Trust. It holds Bitcoin on behalf of its shareholders, tracking the CMBI Bitcoin Index, with Coinbase serving as its custodian. The price of OBTC shares may fluctuate above or below the value of its Bitcoin holdings, often deviating from the spot price of Bitcoin. The acquisition by Bitwise aims to mitigate this disparity by reducing the management fee from 0.49% to 0.2%, providing investors a closer alignment to the spot price of Bitcoin and financial benefits.
Bitwise Expansion in Europe
In addition to its U.S. success, Bitwise announced on August 19 that it had acquired British cryptocurrency ETP provider ETC Group. This acquisition will push Bitwise’s total assets under management to over $4.5 billion. ETC Group provides a range of exchange-traded crypto products, including those linked to Bitcoin, Ethereum, and Solana, catering primarily to European investors with assets worth $1 billion.
The acquisition of Osprey Bitcoin Trust has enabled Bitwise to strengthen its market position and offer better terms to investors. The company's expansion into Europe further solidifies its global influence.
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