In response to the announcement, OBTC's unit price rose by 3% to $29.84, reflecting a remarkable 151% increase over the past year, although it remains below its all-time high of $50.

OBTC was previously a competitor to the Grayscale Bitcoin Trust, which successfully converted to a spot Bitcoin ETF in January 2024.

This move by Osprey is part of a broader trend where financial firms are increasingly integrating cryptocurrency products into traditional investment vehicles.

The ETF market has recently seen increased activity, with the SEC approving Bitcoin and Ether index ETFs from Hashdex and Franklin Templeton in late December 2024.

Osprey Funds, based in Fairfield, Connecticut, focuses on creating secure and cost-effective investment products for digital assets.

The firm has indicated that it will file the Form S-1 registration statement with the SEC as soon as possible to expedite the conversion process.

The firm plans to file a Registration Statement on Form S-1 with the U.S. Securities and Exchange Commission (SEC) to initiate this conversion.

This decision follows the failure to secure necessary regulatory approvals for the acquisition deal with Bitwise, which was initially proposed in August 2024.

The termination of the acquisition has prompted Osprey to explore various strategic options, particularly as OBTC has been trading at a discount to its underlying Bitcoin assets.

If approved, Osprey will join a growing U.S. ETF market that currently includes 32 Bitcoin ETFs, of which 11 are spot ETFs managing around $109 billion in assets.

Osprey Funds has announced its intention to convert the Osprey Bitcoin Trust (OBTC) into an exchange-traded fund (ETF) after terminating a proposed acquisition deal with Bitwise.

As of early January 2025, OBTC managed approximately $186.7 million in assets, with each share representing about 0.000326 Bitcoin.