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SEC Approves Bitcoin ETF

After years of trial and error by potential fund sponsors, cryptocurrency investing is finally opening up to the masses with the tacit US approval of an exchange-traded Bitcoin fund.

The Securities and Exchange Commission (SEC) gave the industry its first go-ahead for Bitcoin futures ETFs on Friday after the five regulator commissioners met on the issue. start next week.

The company issued a modified post-effective prospectus on October 15th stating that it is expected to be launched on Monday October 18th, although the Fund may not start trading immediately.

Proponents of a Bitcoin ETF believe the product will be more accessible to Bitcoin enthusiasts than the actual cryptocurrency by offering investors a regulated alternative to the underlying digital asset. The first product tracks bitcoin futures and not the bitcoin price. However, EU President Gary Gensler noted that he believes that futures-based products could offer investors greater protection because of the laws to which they are subject.

The SEC has explicitly denied requests for Bitcoin ETFs in the past, but does not have to officially approve them. Under federal law, the SEC may allow a motion to go into effect instead of making a formal announcement.

‘Encouraging sign’

ETFStore President Nate Geraci told CoinDesk that the form is “a step forward” for digital assets, uniting them with the more traditional financial sector. It confirmed that filing a retrospective amendment is the tacitapproval of the SEC.
It is an encouraging sign of the future of cryptocurrencies to see SEC Chairman Gensler helping top investors access Bitcoin exposure more easily, he said in an email. The availability of a Bitcoin ETF will now bring more investors under the crypto tent and enable better education across the room.
James Seyffart, an analyst at Bloomberg Intelligence, also confirmed to CoinDesk that the presentation is a sign that the fund is about to be launched.
It also assumes that the introduction of a futures-based ETF will act as a bridge to the eventual introduction of a spot market-based ETF.
Seyffart noted that ProShares’ amended filing removed the language that the fund may invest in Canadian Bitcoin ETFs as a kind of hedge.
“It appears that the SEC didn’t like that language for some reason,” he said. “But they follow standard guidelines and allow the first to present the start to be the first. Hence, we will be closely monitoring the benefit of being the first to move.”
A ProShares spokesman referred CoinDesk to the prospectus after it came into effect.

Long time coming

Industry participants have long tried to launch a Bitcoin ETF, and Gemini founders Tyler and Cameron Winklevoss looked for an ETF for the first time in 2013. The SEC has denied all previous filings, and yet you still need to review more than 30 other recent filings. Applications.

However, the SEC should approve the launch of futures ETFs this year. Gensler’s comments in support of a futures ETF suggest that he will not allow a spot market ETF to be launched anytime soon.

“I very much doubt the SEC will approve the product this year,” said Seyffart.

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