The recent crypto fever has been a boon for some Wall Street funds that bet on Grayscale Investments LLC, the crypto firm that won a landmark case against the US financial regulator over its plan to launch a US Bitcoin ETF.
Grayscale’s victory boosted the shares of its $16.6 billion Grayscale Bitcoin Trust (GBTC), which could soon become the first US spot Bitcoin ETF.
The trust’s shares had been trading at a significant discount to its underlying assets, but the court ruling against the Securities and Exchange Commission (SEC) in late August sparked a rally that narrowed the gap.
This means that investors who bought the shares at a lower price are now enjoying a profit.
According to industry filings, some of the funds that benefited from this move include ARK Investment Management, led by Cathie Wood, Saba Capital Management, founded by Boaz Weinstein, and the hedge fund Fir Tree.
These firms had accumulated large stakes in GBTC in the months before the verdict.