Grayscale Investments has completed reverse share splits for its Bitcoin Mini Trust ETF and Ethereum Mini Trust ETF, effective from Nov. 19, 2024.
Grayscale Investments has completed reverse share splits for its Bitcoin Mini Trust ETF and Ethereum Mini Trust ETF, effective from Nov. 19, 2024. These splits are designed to increase the cost efficiency of the funds and meet the demands of the investment community, according to Grayscale. The changes have resulted in a significant increase in the share prices of both funds.
For the Grayscale Bitcoin Mini Trust ETF, the reverse share split was done at a 1:5 ratio, meaning that for every five shares held by investors before the split, they will now hold one post-split share. The price per share, however, has increased fivefold, reflecting the adjusted net asset value (NAV). Similarly, the Grayscale Ethereum Mini Trust ETF underwent a 1:10 reverse split, with each 10 shares consolidated into one, causing the price per share to rise by a factor of 10.
As a result of the reverse splits, the number of shares held by investors will be proportionally reduced, but the overall value of their investments will remain unchanged. Fractional shares, which are not tradable on NYSE Arca, will be tracked through the shareholder’s depository trust company, and any fractional shares created by the split will be aggregated and sold. Shareholders will receive cash proceeds from the sale of these fractional shares in proportion to their holdings.
Grayscale's move is part of a larger strategy to adapt its products to meet evolving market conditions. The firm emphasized that these adjustments were made in response to client feedback, aiming to improve the trading experience and enhance the funds' attractiveness for investors. Despite the changes in share price and the reduction in the number of shares held, Grayscale reassured investors that their holdings' value remains unaffected by the splits.
At the time of writing, the Grayscale Bitcoin Mini Trust ETF was priced at around $41 per share in pre-market trading, while the Ethereum Mini Trust ETF was priced at $2.90 per share. Grayscale confirmed that shareholders do not need to take any action, as the reverse share split will happen automatically.
The reverse splits also introduce the possibility for fractional share trading through internal company ledgers. This feature allows investors to hold and potentially sell fractional shares, though they cannot trade these shares on the open market. These changes reflect Grayscale’s ongoing efforts to enhance the usability and accessibility of its crypto investment products in a competitive and growing market.
These adjustments come as the broader cryptocurrency market continues to see increased interest, with Bitcoin ETFs recently reporting substantial inflows, further underscoring the growing appeal of digital asset investments.
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