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Cryptocurrency firm Grayscale is turning to a Wall Street alum for its new CEO
(Bloomberg) — Michael Sonnenshein will step down as CEO of Grayscale Investments after a decade at the cryptocurrency asset manager and will be replaced later this year by Peter Mintzberg.
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Mintzberg, currently global head of strategy for asset and wealth management at Goldman Sachs Asset Management, will become the new CEO on Aug. 15, Grayscale said in a press release. In the meantime, Chief Financial Officer Edward McGee will lead the company, Grayscale said.
Sonnenshein joined Grayscale in 2014 and has served as CEO for the past three years. He resigned to pursue other interests, the company said. The move was first reported by the Wall Street Journal.
Under Sonnenshein’s leadership as CEO, Grayscale won a historic battle against the SEC, which paved the way for the approval of the first spot Bitcoin ETFs. Grayscale had been trying for years to convert its Grayscale Bitcoin Trust (ticker GBTC) into an exchange-traded fund. After the conversion, the fund suffered billions in outflows as investors flocked to the newly launched, cheaper Bitcoin spot ETFs.
Read: Grayscale plans new Bitcoin fund as GBTC loses billions
GBTC was once one of the only ways investors could bet on the world’s largest cryptocurrency without purchasing the token directly; assets peaked at nearly $44 billion in 2021.
Since converting to an ETF in January, GBTC has bled more than $17.6 billion. The other ten US Bitcoin spot funds have all had positive inflows this year, with BlackRock’s $15.6 billion haul leading the way. GBTC charges a 1.5% expense ratio, while other funds charge a fraction of that.
Sonnenshein said in an interview with Bloomberg TV in January that GBTC’s relatively high fee is justified by the company’s “size, liquidity and track record.”
“As an investor, when choosing between these products, the fees are a consideration, the asset manager, the issuer behind it are a consideration, but the size, the liquidity and the track record should also be,” Sonnenshein told All era.
The SEC rejected Grayscale’s proposal to convert GBTC in 2022, arguing that a Bitcoin-based ETF lacked adequate oversight to detect fraud. Grayscale filed a lawsuit to overturn the decision, accusing the SEC of discriminating against its product while approving similar Bitcoin futures ETFs.
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Grayscale’s board of directors and its parent company, Digital Currency Group, have begun searching for a new CEO in late 2023, according to the Wall Street Journal, which cited people familiar with the matter. The research was not related to GBTC’s performance or outflows, the report said.
“The crypto asset class is at an important inflection point and this is the right time for a smooth transition,” Sonnenshein said in a press release.
–With assistance from Katie Greifeld.
(Updates throughout)
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