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The head of cryptocurrency asset manager Grayscale Investments steps down
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Michael Sonnenshein has stepped down as CEO of Grayscale Investments, after more than a decade helping establish the US group as one of the world’s largest cryptocurrency asset managers.
He will be replaced in August by Peter Mintzberg, global head of wealth and wealth management strategy at Goldman Sachs.
Sonnenshein joined Greyscale in 2014 to help build its bitcoin investment fund and was chief executive as of 2021. He was leaving to “pursue other interests,” the group said in a statement.
His departure comes as Grayscale faces stiff competition to dominate the emerging market for exchange-traded funds in which they invest directly bitcoin.
Last year, Grayscale won a decisive victory in court that set the stage for the ad’s approval by the Securities and Exchange Commission exchange-traded funds in January, after a year of rejections.
The approval also allowed Grayscale to convert its bitcoin trust into an ETF, but its initial lead, when it had $28 billion in assets under management, has slowly been whittled away. Rivals like Fidelity, Ark and BlackRock have lowered their rival’s rates, and Grayscale’s rate of 1.5% is the highest on the market.
Grayscale ETF holders have withdrawn more than $17 billion since January, and assets under management have fallen to about $19.4 billion, according to Morningstar. BlackRock’s bitcoin ETF has since grown to $18.4 billion.
“By successfully winning a court case, the company has created a rapidly growing segment of the ETF market,” said Todd Rosenbluth, head of research at VettaFi, a consultancy. “However, stiff competition from some of the largest asset managers such as BlackRock and Fidelity has eroded Grayscale’s capital advantage.”
The New York group said Edward McGee, chief financial officer, will lead the company until Mintzberg starts on Aug. 15.
“Peter is an exceptional strategic leader with global expertise among leading asset managers, which are critical ingredients in positioning Grayscale for its next phase of growth,” said Barry Silbert, CEO of Digital Currency Group, owner of Grayscale. He was not available for an interview Monday.
“This is an exciting time in Grayscale’s history as it continues to build on the asset class’s unprecedented momentum,” Mintzberg said in a statement.
Sonnenshein said in a LinkedIn post that he leaves “with deep gratitude to everyone who took part in this incredible rocket ride” and was “thrilled for what comes next.”
Grayscale also runs a $9 billion Ethereum trust and is one of several asset managers looking to launch an Ethereum ETF. The SEC faces deadlines this week to decide whether to approve two such ethereum ETF applications.