Digital Currency Group (DCG) and Grayscale Investments have recently come under the spotlight regarding the practices of Grayscale's Bitcoin Trust (GBTC). Representative Brad Sherman, from the U.S., earlier this month sent a letter to the U.S. Securities and Exchange Commission (SEC) and its Chairman Gary Gensler criticizing GBTC’s exorbitant fees and their relationship with DCG.

The public outcry has mainly been caused by such expensive fees and the fact that Grayscale has issued additional shares of GBTC to the detriment of the 850,000+ retail investors who are currently unable to access their assets. Data from ycharts revealed that shares of GBTC are currently trading at a discount of 39,76%, a decrease from the initial 40% rate.

In the letter sent to the SEC and its chairman, Congressman Sherman questioned Grayscale’s refusal to permit shareholders to redeem their funds - citing Regulation M as the reasoning behind such decision, which prohibits simultaneous sales and redemptions of the same security - and the lack of an independent director on the board. Furthermore, a 2% fee - based on Bitcoin - was also seen as an excessive charged to all shareholders.

Sherman, in his letter, asked the SEC to provide answers on these issues by May 15. The Congressman urged the financial institution to be protect the interests of the investors by clarifying the controversial topics and to possibly intervene in the situation.

Overall, DCG and Grayscale have apparently gained the attention of the political space, without expecting it. As the letter sent by congressman Sherman to the SEC is still awaiting a response, the criticisms could eventually lead to the financial organizations taking action on GBTC, in favor of its investors.



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