STAMFORD, Conn. (GLOBE NEWSWIRE) — Grayscale Investments, a leading asset management firm specializing in cryptocurrency investment products, today announced the successful completion of reverse share splits for two of its flagship ETFs:
- Grayscale Bitcoin Mini Trust ETF (NYSE Arca: BTC)
- Grayscale Ethereum Mini Trust ETF (NYSE Arca: ETH)
The splits became effective at 5:00 PM Eastern Time on November 19, 2024.
Key Details of the Reverse Splits
| ETF | Split Ratio | New Share Price Calculation | CUSIP Number |
|---|---|---|---|
| BTC | 1:5 | 5x pre-split NAV | 389930 207 |
| ETH | 1:10 | 10x pre-split NAV | 38964R 203 |
Impact on Shareholders:
- Proportional decrease in number of shares outstanding
- No change in total portfolio value
- Continued trading under existing ticker symbols ("BTC" and "ETH")
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Understanding Reverse Share Splits
A reverse share split consolidates existing shares into fewer, higher-priced shares. This financial maneuver:
- Increases per-share price while maintaining total market capitalization
- Often used to meet exchange listing requirements
- Doesn't inherently change the fund's underlying value
Example Scenario (BTC 1:5 Split):
| Period | Shares Owned | NAV/Share | Total Value |
|--------|-------------|----------|------------|
| Pre-Split | 500 | $2 | $1,000 |
| Post-Split | 100 | $10 | $1,000 |Regulatory Status Important Notice
Both funds:
- Are not registered under the Investment Company Act of 1940
- Don't offer the same protections as registered ETFs/mutual funds
- Carry higher risk profiles than traditional investment vehicles
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Fractional Share Policy
Post-split fractional shares will be handled through:
- DTC participant internal ledger tracking, OR
- Aggregation and cash settlement of fractional shares
Note: Fractional shares cannot trade on NYSE Arca.
Investment Considerations
Before investing, understand that:
- Digital assets involve substantial risk
- These aren't direct Bitcoin/Ether investments
- Funds may experience heightened volatility
- Potential for total loss of investment exists
FAQ Section
Q: Why did Grayscale implement these reverse splits?
A: To increase share prices while maintaining equivalent portfolio value, potentially improving marketability and meeting exchange requirements.
Q: How does this affect my current holdings?
A: You'll own fewer shares at proportionally higher prices, with no net change to your investment's total value.
Q: Can I still trade these ETFs normally?
A: Yes, both continue trading under their original symbols (BTC and ETH) on NYSE Arca.
Q: What happens to fractional shares?
A: They'll either be tracked internally or converted to cash proceeds distributed proportionally.
Q: Are there tax implications?
A: Consult a tax professional, but generally reverse splits aren't taxable events in themselves.
Q: How does this compare to traditional ETF splits?
A: Traditional splits increase share count to lower prices, while reverse splits do the opposite—both maintaining total value.
About Grayscale Investments
With over a decade of crypto asset management experience, Grayscale offers:
- Single-asset investment products
- Diversified crypto exposure
- Thematic investment strategies
Media Contact:
Jennifer Rosenthal
[email protected]
Client Services:
866-775-0313
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