So far, the U.S. Securities and Exchange Commission (SEC) has rejected all Bitcoin ETF applications. Since the submission of the first U.S. Bitcoin exchange-traded fund application in 2013, Bitcoin ETFs have become a dream target for the cryptocurrency community.
ETF is a publicly traded investment tool, usually used to track the value of linked assets. Advocates of Bitcoin ETF believe that the complexity of exchanges, cryptocurrency wallets, and private keys still pose a daunting barrier for newcomers to enter the cryptocurrency space. Bitcoin ETFs will enable these investors to gain exposure to Bitcoin without actually holding their own cryptocurrency.
Bitcoin ETFs have emerged all over the world, and there are tradable Bitcoin ETFs in Canada, Brazil and Dubai. But so far, the SEC has rejected all Bitcoin ETF applications for the simple reason that cryptocurrency traders may conduct market manipulation.
The following are all applications currently in progress.
VanEck is one of the earliest Bitcoin ETF applicants. Its first attempt at Bitcoin ETF in cooperation with SolidX-VanEck SolidX Bitcoin Trust, can be traced back to 2018.
Although the application was withdrawn in September 2019, VanEck continued its second attempt to apply for a Bitcoin ETF. In December 2020, it submitted an application for the VanEck Bitcoin Trust to the SEC. The trust’s shares will be traded on the Cboe BZX exchange. .
It is worth noting that VanEck submitted its second application only a few days after the departure of former SEC chairman Jay Clayton. In an interview with CNBC in 2019, Clayton was dismissive of the prospects of Bitcoin ETFs. He pointed out that although “progress” has been made in terms of regulation, cryptocurrencies are still vulnerable to price manipulation, and overseas exchanges “have no offer to connect with the United States.” The same level of protection for the stock market”.
However, if VanEck believes that the SEC’s high-level changes will mean a change in its position, they will obviously be disappointed. The SEC has repeatedly postponed its decision on VanEck’s second Bitcoin ETF application. The most recent postponement was to postpone the deadline to August. This time, the SEC invited the public to comment on whether the crypto market is easily manipulated, whether the cryptocurrency industry has changed since 2016, and whether Bitcoin is transparent or not.
2. Valkyrie Investment Company
As a relatively new entrant, asset management company Valkyrie submitted an application for a Bitcoin ETF in January 2021. The ETF will refer to the Chicago Mercantile Exchange’s Bitcoin reference price and trade on the New York Stock Exchange Arca. The company wrote in its proposal, “providing investors with an effective means to implement various investment strategies.” Encrypt Xapo, a currency custodian, will protect the fund’s bitcoins and store them in cold storage.
In its documents, Valkyrie defaulted to the volatility of cryptocurrencies, which is also the SEC’s main concern for Bitcoin ETFs. It stated in a risk assessment: “The potential consequences of Bitcoin’s volatility may adversely affect the value of stocks.”
3. New York Digital Investment Group NYDIG/Stone Ridge
New York digital investment group NYDIG and consulting firm Stone Ridge quickly seized the opportunity brought by the SEC leadership change and became the second company to submit an ETF application to the regulator in 2021. The February 16 application was a lucky day for Bitcoin, and the cryptocurrency reached $50,000 for the first time in its history. Since then, the SEC has hidden this application; although it has announced the results of delaying other applications, it has not announced that it will review NYDIG’s application.
WisdomTree, an asset management company headquartered in New York, already has experience in operating a Bitcoin ETF; it launched a Bitcoin ETF on the Swiss SIX stock exchange as early as 2019. It joined the U.S. Bitcoin ETF application in March 2021. The company submitted an S-1 document to the SEC, proposing to list the shares of WisdomTree Bitcoin Trust on the Cboe bZx exchange under the ticker symbol BTCW.
Since then, the SEC has been procrastinating and invited the public to give feedback on the proposal “written data, opinions and arguments on whether the proposal should be approved or disapproved.”
5.First Trust / SkyBridge
In March 2021, the hedge fund SkyBridge Capital submitted an application for a Bitcoin ETF to the SEC. The company, run by former White House communications director Anthony Scaramucci, already runs a Bitcoin fund open to accredited investors with a minimum investment of $50,000; in the weeks following its opening in January 2021, the fund has grown To more than 370 million US dollars. In the same month, Scaramucci expressed optimism that the Bitcoin ETF may be approved by the end of 2021. In an interview with Decryt, he said, “I hope that with Gary Gensler’s appointment, crypto assets can be introduced into the scope of supervision, although I don’t understand his thoughts. But my understanding is that maybe we can get an ETF before the end of this year.”
In May, the New York Stock Exchange Arca filed a proposed rule change application that would list SkyBridge Capital’s Bitcoin ETF on the exchange. In early July, the SEC postponed the review period of the Skybridge Bitcoin ETF to August 25.
6. Fidelity/Wise Origin
In March 2021, applications for Bitcoin ETFs flocked, including Fidelity’s Wise Origin Bitcoin Trust Fund. Perhaps this is not surprising, because just a few weeks ago, its global macro director Jurrien Timmer said that Bitcoin has a “unique advantage” over gold. In the application for the Wise Origin Bitcoin Trust Fund, Fidelity Service Company Inc will act as the administrator, while Fidelity Digital Assets will be responsible for custody of the ETF’s Bitcoin.
In May 2021, Cboe Global Markets submitted a proposal for the listing of Fidelity’s Bitcoin ETF, arguing that as more and more investors participate and institutions adopt cryptocurrencies, it “promotes the maturity of the Bitcoin trading ecosystem.” The SEC’s concerns about market manipulation have been “fully eased.” In the same month, the SEC began reviewing Fidelity’s application.
Delaware-based Kryptoin made its first attempt to apply for a Bitcoin ETF in October 2019. The proposed Kryptoin Bitcoin ETF trust will be listed on the New York Stock Exchange Arca. The financial services company made a second attempt at the Bitcoin ETF in April 2021, and the revised proposal was to list the trust fund on Cboe’s BZX exchange. Its revised document lists service providers that will assist in launching its ETF, including cryptocurrency exchange Gemini, which will provide custody for the trust fund’s bitcoin holdings.
By the end of the month, the application was formally reviewed by the SEC, and the committee postponed its decision on the application to July 27, 2021. The SEC wrote in its June 9 announcement, “The committee believes that it is appropriate to assign a longer period of time to take action on the proposed rule change, so that it has enough time to consider the proposed rule change and receive Views,”
In April 2021, the cryptocurrency investment company Galaxy Digital applied for the establishment of a Bitcoin ETF; at the time, this was the eighth such application that fell on the SEC’s table. The proposed Galaxy Bitcoin ETF will be listed on the New York Stock Exchange Arca. Galaxy Digital manages more than US$400 million in assets and is also one of the largest institutional holders of Bitcoin, with 16,400 Bitcoins in its warehouse (valued at more than US$680 million at current prices).
Billionaire Galaxy Digital founder Mike Novogratz expressed his views on the SEC’s unwillingness to approve Bitcoin ETFs at the 2021 Ethereal Summit. He believed that under the Trump administration, the SEC allowed the Grayscale Bitcoin Trust (GBTC) to flourish. “Not so good” for consumers. Novogratz believes that GBTC sees consumers “buying Bitcoin at a premium of 20-30% and being arbitraged into a closed-end fund by hedge funds, while ETFs were originally a more elegant solution.”
Ark Invest, an investment company led by Cathie Wood, submitted an application for the Ark21Shares ETF in June 2021. ARK Invest cooperates with the Swiss ETF provider 21Shares AG to provide the ARK 21Shares Bitcoin ETF; if approved, it will be traded on Cboe’s BZX exchange under the stock code ARKB.
The company was also the first company to disclose the fees of its Bitcoin ETF. The documents show that it plans to pay a 0.95% fee to 21Shares, which the company will use to pay for operating expenses.
Ark has been exposed to Bitcoin risk exposure. The fund has invested in cryptocurrency exchange Coinbase, Grayscale Bitcoin Trust and payment processor Square, which holds more than 8,000 BTC on its balance sheet. CEO Cathie Wood is an active supporter of Bitcoin. She believes that cryptocurrency represents “a new asset class” and it is not surprising that it can become a reserve currency.
The most recent entry into the Bitcoin ETF competition is Global X Digital Assets, a fund management company that manages $31 billion in assets. It submitted an application to the SEC in July 2021. If approved, the proposed Global X Bitcoin Trust will be traded on the Cboe BZX exchange, and Bank of New York Mellon will be appointed as the trust’s administrator.
GlobalX’s investment portfolio covers 84 ETFs, covering disruptive technologies, stock returns, commodities and emerging markets. Its proposed trust fund has not disclosed its stock code or the identity of the custodian responsible for custody of its bitcoins, although it has disclosed that the custodian is a limited-purpose trust company authorized to provide digital asset custody services in New York State.
One River Asset Management initiated the Bitcoin ETF application in May 2021, and it applied for a carbon-neutral Bitcoin exchange-traded fund. As Bitcoin’s energy consumption and carbon footprint have received increasing attention, One River pledged to “purchase and recover the necessary carbon credits through the environmental protection platform Moss Earth to account for the estimated carbon emissions associated with the Bitcoin held by the trust company.” Amount” to offset its carbon footprint.
One River also used artillery in its fight for the SEC and invited the former chairman of the SEC, Clayton, as an adviser. Clayton joined the company before the Bitcoin ETF application, and he led the committee when the SEC rejected all Bitcoin ETF applications.
12.Invesco Galaxy Bitcoin ETF
Galaxy Digital and Invesco jointly submitted a Bitcoin ETF on September 22, 2021, called Invesco Galaxy Bitcoin ETF. According to the document, the ETF will also be “physically backed” by Bitcoin instead of derivatives such as futures. Invesco Capital Management LLC is the initiator of the document, but it is not yet known which company will hold the bitcoins for the document. The sponsor is a wholly-owned subsidiary of Invesco Limited. The company is also the fourth largest ETF supplier in the United States, and this qualification may help make the application approved. “Invesco Galaxy US ETF Strategy Director John Hoffman said: “For someone who has been in the ETF business for a long time, this has a striking similarity with the early days of ETFs, that is, the late 1990s and early 21st century. “
Cryptocurrency investment fund manager Grayscale has not yet formally applied for a Bitcoin ETF, but it has made no secret of its desire. This American investment company already operates a closed GBTC Bitcoin Trust, which manages more than 650,000 Bitcoins (valued at $25 billion at today’s prices). It has announced, “We are 100% committed to converting GBTC to ETF”.
If it does so, Grayscale will be able to charge lower management fees and it will be easier to get funds in and out. Grayscale submitted an application to launch a Bitcoin ETF in 2016, but withdrew it a year later, stating that “we believe that the regulatory environment for digital assets has not yet developed to the point where it can successfully market this product.”
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/an-overview-of-the-queuing-army-of-the-us-bitcoin-etf-2/
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