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Canada’s First Bitcoin ETF Collects $421M In First 2 Days

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Times are changing and Bitcoin ETF’s long-term outlook is brightening, at least in North America. The first-ever Bitcoin ETF that was launched earlier this week has reportedly collected an astonishing $421 million in assets in the first two days of its launch.

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This was revealed by Bloomberg’s Analyst Eric Balchunas in his latest tweet about the world’s first Bitcoin ETF by the asset management company, Purpose Investments Inc. It made a debut on the Toronto Stock Exchange on the 18th of Feb.

Soaring Bitcoin ETF

Here’s what Balchunas had to say about the latest figures of the Bitcoin ETF,

“Proportionally speaking it is the equiv of a US ETF taking $8 billion in first two days. If it were to keep up this pace it will be the biggest ETF in Canada in 20 days.”

He also went on to add,

“The premium on this puppy was a mere 0.40% on Friday, or 250x less than $GBTC on Day Two. The beauty of arbitrage. This is about what we thought it would be, 20-60bps depending on day and poss over 100b on crazy days. In short, working as designed”

The figures show the popularity of Bitcoin ETFs in the country as its underlying crypto-asset continued to conquer new highs every week as it sits above the $1 trillion market cap.

The immense popularity can be attributed to the fact that these vehicles offer investors looking for a low risk way of reaping the profits Bitcoin’s bull run.

For the uninitiated, two Bitcoin exchange-traded funds were launched back to back on the Toronto Stock Exchange this week. Leading the charge was Purpose’s ETF, under the ticker “BTCC” launched this Thursday.

The fund witnessed a monumental interest, as it was found to be trading more than $100 million shares on its first day alone. If this continues, the ETF could potentially reach $1 billion in assets by the end of next week.

Just a day later, Evolve Funds Group Inc which happens to be yet another Canadian platform with $1.7 billion in assets under management [AUM], announced the launch of the Bitcoin ETF – EBIT. This Bitcoin ETF, on the other hand, was trading at $1.271 million AUM.

The latest news definitely raises stakes for the US policymakers especially the SEC which is yet put a stamp of approval to a Bitcoin exchange-traded fund.

Bitcoin Rising Due To The Inefficiency Of Existing Payment Mechanisms, Suggests SEC Chair

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As several dived into the crypto-verse after realizing the capabilities of Bitcoin, regulators began paying heed to the industry. New regulations were put in place while the existing ones were tightened. Suddenly, crypto-platforms had to seek permission from the government to roll out new crypto products. One such example is the application to launch a Bitcoin ETF, however, this never saw the light of the day, thanks to SEC Chairman Jay Clayton. But, Clayton seems to have taken a different road while he gears up to bid adieu to his role.

Clayton’s Closing Thoughts On Bitcoin

Over the past year, Jay Clayton, Chairman of the US Securities and Exchange Commission, has turned down over nine Bitcoin ETFs by either delaying them or pointing out their incompetence. While the crypto community was disheartened by the constant rejection of the Bitcoin ETFs, they were happy to see that Clayton has stepped down from his position as chairman of the SEC. As Clayton is preparing to hand over his office this December, he appeared in an interview with CNBC’s Squawk Box.

Bitcoin / Jay CLayton

In the interview, Chairman Clayton addressed the regulations surrounding Bitcoin. He pointed out that the SEC had regulated Bitcoin by categorizing it as a payment mechanism and a store of value as opposed to security. Bitcoin was born out of the 2008 financial crisis that left the average Joe in shackles. Elaborating on the same, Clayton suggested that the incapabilities that the existing payments devices entail could possibly act as a catalyst for Bitcoin.

He added,

“What we are seeing is that our current payment mechanisms, domestically and internationally, have inefficiencies. Those inefficiencies are the things that are driving the rise of Bitcoin and other digital assets. We’re gonna see more of that. We’re gonna see this mature and we’re gonna see more regulation around the digital payment space.”

Additionally, the Chairman also spoke about the ICOs and the ICO craze that struck the crypto-verse a few years ago.  He revealed that people steered away from the protocol of registering crypto assets with the SEC as securities to raise capital for a venture.

Back in 2017, Clayton was nominated by the Chairman of the SEC by President Trump. Three years and rejection of nine Bitcoin ETFs later, Jay Clayton would leave his position in December. This transpired as positive news to the crypto-verse as dainty hope was restored with regard to the fate of Bitcoin ETFs.

Gold and Silver Smashing New Records, Will Bitcoin Follow

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Discount Brokerage Platform Robinhood has made a spike in the trading activities of gold-tethered traded funds (ETFs). The data from the analytics site, Robintrack, recorded a surge in the number of Robinhood users trading SPDR Gold shares Exchange Traded Funds from 6,000 in 2019 to 26,000 this year. Silver, on the other hand, rose to record highs after moving toward $20.00 per ounce price point.

Gold Trading Performance Surges by 0.40%

Gold approached $1,950 an ounce price support after rising by 0.40 percent and trading an ounce at $1817.50. The weakening of the US dollar as a result of Covid-19 seems to have been Gold’s lifting force. Silver’s price action has taken an overnight surge of 3.0 percent to reach its current price.

Price actions of either metals gave Peter Schiff enough reason to mock bitcoin for its failure to rally strongly against Silver. The epic trader and analyst posted on Twitter that Silver was the “new bitcoin”

Schiff claimed silver was rallying high percentages over the count of 10, while bitcoin was hardly up by 2%. At the time of Schiff’s twitter post, Silver hit a 6-year high after rising by 7% to $21.15 per ounce. The leading crypto, on the other hand, stalled around $9,300 after breaking away from the $9,200 resistance on Tuesday. 

Silver is the New Bitcoin For Millennial

It’s not clear whether Silver could take the lead in making investments and become the next bitcoin; but what’s clear is that millions of millennials are hovering around platforms like Robinhood to trade in all things-assets. However, the only limitation that silver faces are that it is less liquid. On average, the supply of silver is lower compared to both Gold and Bitcoin. That’s why most of the silver directional moves post staggering records and are more aggressive. Yet, it seems millennials are more than ready to invest in anything that promises returns.

Nevertheless, Schiff said that the silver was a new kind of bitcoin with direct utility. The trader advised bitcoin enthusiasts to turn to silver and to hesitate to back up the wrong asset.

Will the Bitcoin ETF Get Approved in 2020 as an Institutional Demand Increase?

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Over the last few years, a particular bitcoin discussion that has repeatedly made headlines is about the Bitcoin ETF. On the downside, the headlines have mainly painted the words ‘rejection’ and ‘SEC.‘

Since 2019, a list of notable institutions and firms has forwarded their proposal for a Bitcoin ETF to the U.S. Securities and Exchange Commissions. However, the result has always been the same as the SEC kept shooting down all the filings. The latest to bite the dust came from Wilshire Pheonix in March 2020 and the firm expressed its disappointment after the SEC had rejected their proposal.

Despite the fact that the Bitcoin ETF is being played out, again and again, it is important to note that the institutional funds have not stopped flowing in.

Accredited interest in Bitcoin and a possible ETF

As previously reported, the 1st Bitcoin index fund in Hong Kong underlined the fact that accredited investors had raised the demand for Bitcoin in the markets. The interest can also be identified from Grayscale’s recent Q1 2020 report.

According to the Grayscale, in spite of the current global financial meltdown, an allocation of over $389 million was made into the Grayscale Bitcoin Trust or GBTC from January to March 2020. The report suggested,

“88% of inflows this quarter came from institutional investors, the overwhelming majority of which were hedge funds. The mandate and strategic focus of these funds is broadly mixed and includes Multi-Strat, Global Macro, Arbitrage, Long/Short Equity, Event Driven, and Crypto-focused funds.”

With respect to the above data, a legitimate case can be made that the Bitcoin ETF could be approved in 2020. The major reason for the approval of an ETF would come down to the reduction of premium rates.

Longhash’s recent report had suggested that accredited users are used to trading Bitcoin at a whopping 30 percent in GBTC. That means, if the market price of Bitcoin would be traded at $10,000, the investors would be investing BTC worth over $13,000 at Grayscale.

Such differences were likely to be removed as some of the past ETFs claimed that a reduction in premiums would be facilitated and standardized pricing would be manifested for the crypto asset.

Grayscale also received a higher premium because there were no alternatives to the Bitcoin ETF other than GBTC. Hence, under high demand, BTC and ETH would consistently trade high premiums on Grayscale.

But now that current institutional interest is on the upswing, the Bitcoin ETF could be quite inevitable. SEC Commissioner, Hester Peirce has also been a vocal supporter of the ETF in the past, as she said in February 2020.

“Permitting institutional investors and regulated exchanges to enter this market would lead to more robust protections for retail investors (who, to be clear, are already active in the underlying spot market), to better custody solutions for Bitcoin, and to more effective surveillance for market manipulation and other fraudulent activity.”

SEC Emerges As Villain Again As another Bitcoin ETF Gets Rejected

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Bitcoin ETF”s has been making rounds for the past couple of years, but since its inception, the entity has faced the wrath of both the government and the regulators. In the most recent series of events, the US Securities and Exchange Commission[ SEC] dismissed another proposed ETF.

The regulators shot down the ETF proposed by Wilshere Phoenix, who thought he was going to do away with the ‘ ETF rejection trend. ‘

Phoenix had applied for Equity Trading Fund [ETF] in May 2019 with the New York Stock Exchange [NYSE] Arca. The SEC rejected the ETF by stating there was no proof that Bitcoin could sustain without market manipulation. The issue of manipulation was brought up again because of the incessant dips in prices that occurred recently.

According to the official SEC release:

“The Commission concludes that NYSE Arca has not met its burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that its proposal is consistent with the requirements of Exchange Act Section 6(b)(5), and, in particular, the requirement that the rules of a national securities exchange be ‘designed to prevent fraudulent and manipulative acts and practices’ and ‘to protect investors and the public interest”

Over the last two years, the SEC has rejected multiple ETFs, one of the most popular being the VanEck ETF. The ETF was tabled multiple times by the regulator for reasons such as ‘cloudy regulations’ and ‘manipulative markets’. Phoenix’s proposed ETF wanted to mix Bitcoin and short-term treasures, according to the SEC release.

The decision to reject the ETF has not boded well with some people and Hester Peirce was definitely one of the enraged members. Peirce, who is the Commissioner of the SEC wrote a scathing dissent where she pointed out that the SEC had a ‘heightened standard’ only for Bitcoin.

Peirce opined that the multiple rejections only meant the SEC had no plans to list products such as Bitcoin and other cryptocurrencies anytime soon. She also clapped back at the ever-shifting standards that the SEC sets just for digital assets. The Commission has been a vocal supporter of Bitcoin ETF and has even made positive comments about the industry earlier.

The proposed fund had plans to change the way people trade Bitcoin and how the cryptocurrency would respond to changes in its price. Wilshere Phoenix had claimed that his Bitcoin ETF would automatically rebalance itself in response to Bitcoin’s price volatility. To balance a change, the now rejected fund would put more capital into bonds and vice versa.

Grayscale Investments files Form 10 with SEC to push for Bitcoin ETF launch

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The launch of the Bitcoin ETF has been one of the most talked-about and controversial events in the cryptocurrency industry. Several companies have tried to launch the asset only to be thwarted by regulatory authorities such as the Securities and Exchange Commission [SEC].

The latest company to come to the forefront about a Bitcoin ETF launch was Grayscale Investment Fund, which recently filed Form 10 with the SEC that will designate the organization’s Bitcoin trust.

Michael Sonnenshein, the Managing Director at Grayscale Investments, had said that the move would help in tapping more institutional investors who act as markers for positive growth. The MD was asked about the timing of the latest filing and claimed that despite the Trust being used for years, the need voiced by the community right now was tremendous.

Shonnenshein further added:

“The need for a Bitcoin ETF was always on the rise and currently it is amazing to see the support for it. Ever since we started in may 2015, the plan was to launch the ETF in a positive regulatory climate and if you look at the trailing trading volume for the past three years, has been declining year after year.”

Sonnenshein added that investors in the space were now actively looking for areas to invest and were even asking around for access products that will enable them to get started in the digital assets industry.

He was also asked about why investors would not directly invest in the world’s largest cryptocurrency rather than going to specific organizations for the very same. The Managing Director said that most of the institutions were worried about the issue around cryptocurrency custody and regulations.

According to him, companies that try to work without a dedicated crypto wing generally end up buried in logistics such as ‘Who at the company will store PKs?’ as well as assigning duties to people who will conduct due diligence in the space. Sonnenshein added:

“We create the look and feel of the product that institutional investors will be able to use. In Q3, we had 84 percent of inflows just from hedge funds that needed their digital assets dealt with efficiently.”

One other company that overcame this issue recently was Fidelity, which received its own bitcoin trading and custody license in the city of New York. The New York State Department of Financial Services had granted the permit that will now allow Fidelity ton securely store, purchase, sell and transfer Bitcoin to citizens in the city.

Disclaimer: The presented information is subjected to market conditions and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

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Bitwise Investment’s Bitcoin ETF Approval Decision is Very Close – Report

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Matt Hougan, Managing Director of the Bitwise Investment, says that the US Securities Exchange Commission (SEC)’s decision to approve their Bitcoin ETF is closer than ever.

In an interview with CNBC yesterday, on October 7, Matt Hougan spoke about their Bitcoin ETF which he believes will be approved by the Securities and Exchange Commission (SEC) very soon. As the SEC has set an Oct 13 deadline for Bitwise’s Bitcoin ETF, it would mark a momentous success in the history of the crypto world, if it receives a green signal.

Will SEC Approve Bitwise Bitcoin ETF?

However, SEC has been reluctant to approve the Bitcoin Electronic Traded fund (ETF) applied by a couple of crypto players in the past. Bitwise filed its Bitcoin ETF application back in January and in August, the regulator apparently postponed the decision on its proposal.

As SEC has postponed its decision to Oct 13, Hougan said that the regulator has no mechanism to postpone its decision on Bitwise BTF any longer. He then quickly asserts that “We’re closer than we’ve ever been before to getting a Bitcoin ETF approved.”

“Sometime before Monday, the SEC has to give its decision: yes or no. They have no more ways to postpone it at this point. We will hear clearly between now and Monday what they think”, Hougan stated.

It is still unclear whether or not SEC could approve Bitwise’s Bitcoin ETF, but Hougan is quite optimistic at SEC’s upcoming decision despite the regulator’s stern tone on ETF so far.

He further recalls the market conditions two years ago and says that the six out of ten major exchanges are now officially regulated by the New York Department of State (NYDS) alongside market surveillance technologies, he emphasized.

“Two years ago, there were no regulated, insured custodians in the Bitcoin market. Today, … there are big names like Fidelity and CoinBase [with] hundreds of millions of dollars of insurance from firms like Lloyd’s of London.”

He further highlights that Bitwise ETF, if approved, will bring the potential opportunity for investors to access the world’s largest cryptocurrency securely. He argued that only big institutions/high net worth individuals have a clear path to buy Bitcoin in private funds – in contrast, his argument is to offer similar service to regular investors via Bitwise Bitcoin ETF.

Disclaimer: The presented information is subjected to market conditions and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

Never miss our daily cryptocurrency news, price analysis, tips, and stories. Join us on Telegram | Twitter or subscribe to our weekly Newsletter.

A new application for a crypto-based ETF is in SEC’s hands (again)

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Having the U.S. Securities Exchange Commission (SEC) approve a cryptocurrency-based exchange traded fund (ETF) has become something of a holy grail for many crypto analysts over the last few years. Many believe that having SEC’s approval would finally give the crypto verse a seal of respectability and credibility from a regulatory agency that it’s lacked so far. It would also ease the way in for institutional investors.

Consequently, many applications have been sent to SEC so far and they’ve all been denied.

SEC’s resistance on the matter hasn’t dissuaded analysts and businesses of the value that an ETF would have for the cryptosphere as a whole and, more particularly, to the company that manages to pull the trick off first, which is why there are new projects and new applications to approve them.

The latest one was filed on May 9th, just a few days ago. So it’s now in possession of SEC. The new prospective ETF is sponsored by the United States Commodity Funds LLC (USCF).

The application’s creator is Crescent Crypto Index Services LLC, and it holds the ticket “XBET.” The company is a subsidiary of Crescent Crypto Asset Management LLC, and it’s a data collection firm that keeps the record of the market performance of Bitcoin and Ether according to market capitalization-weight.

The proposal

The application declares XBET to be an exchange-traded fund (ETF). That means that any investor interested in buying or selling shares in XBET will trade using their broker of choice. And that, in turn, means there will be commissions and charges, which is how brokers make their living.

XBET shares will trade on the NYSE Arca as “XBET.” In fact, they will be traded in the same way in which investors bid or ask for any standard publicly traded security.

USCF is a commodity pool operator. It’s under the Commodity Futures Trading Commission authority as well as the National Futures Association under the Commodity Exchange Act.

There’s competition, of course

So now XBET is on the list of ETF proposals under review by the SEC.

Two other Bitcoin ETFs are waiting for SEC to make a decision. One was filed by Bitwise Asset Management with NYSE Arca. The other one came from vanEck, SolidX and Cboe BZX Exchange. An announcement regarding those two was expected for last March, but it was postponed.

Which will be the first lucky project to become the U.S.’ first digital assets ETF? We don’t know, of course. So far, neither does the SEC. But sooner or later a project will come that will meet SEC’s regulatory requirements, and there’s no reason to believe that one of those three propositions currently under review couldn’t be it. At least non that we know.

It will be a game of patience for all those involved. SEC has been dragging its feet on crypto-related matters in such a way that, while many believed that it would hamper the cryptosphere’s development by trying to interfere too much, the opposite has been exact. It’s been keeping the cryptocurrency market from reaching its true potential by doing nothing and failing to make the appropriate (and often needed) regulatory decisions on time.

Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

SEC receives new Bitcoin ETF request

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A new Bitcoin ETF authorized by the Securities and Exchange Commission has been the talk in the cryptoverse for months now. So far, SEC has turned down all the applications but many experts believe that an ETF is unavoidable. But who will get the first authorization in the US? Ever heard of Reality Shares ETF Trust?

A new application is filed at SEC

Reality Shares ETF Trust filed a new registration statement with SEC just yesterday. They want to start an ETF that will include Bitcoin futures as an investment strategy and instrument. The Reality Shares Blockforce Global Currency Strategy ETF will be managed actively and listed on the NYSE Arca exchange. It’s “designed to provide investment exposure to global currencies, both fiat and virtual currencies,” according to the filing.

The new ETF, if accepted, will trade Bitcoin futures at the Chicago Mercantile Exchange and at the Cboe Futures Exchange.

The new firm’s portfolio will be composed of “high-quality, short-term (no greater than 18-month maturity), sovereign debt instruments” in US exchanges listed as pairs against Swiss Francs, Japanese Yen, British Pounds, Euros, and USD. And there will be more instruments available in “bitcoin futures contracts of various maturities listed for trading on U.S. exchanges that provide exposure to the price movements of bitcoin” as well as “money market mutual funds and/or other cash equivalents.”

The fund’s strategy to get access to Bitcoin future includes an investment that could be as high as 25% in a subsidiary it owns and controls in the Cayman Islands. The filing mentions the fund’s investment adviser in that he “will seek to limit the subsidiary’s investment in bitcoin futures so the fund’s aggregate notional exposure to bitcoin futures is limited to 15% of the fund’s net assets at the time of investment.”

A seasoned player

An advantage to Reality Shares is that it already operates two blockchain-based ETFs in partnership with Nasdaq. One is the Reality Shares Nasdaq Blockchain China Index (BCNA) and the other one is The Reality Shares Nasdaq Nexgen Economy ETF (BLCN). While it’s still anybody’s guess what would be the criteria that could persuade SEC to finally approve a blockchain ETF in the US, a proven track record could surely be very important. Also, the association with Nasdaq could confer credibility regarding integration with the traditional financial system.

The first one came online on June 20th, 2018 and tracks the long-term growth of investment returns in the Reality Shares Nasdaq Blockchain China Index, which includes blockchain-based firms from Hong Kong and mainland China. The first one is a bit older (January 17th) and it tracks similar markets but in the Reality Shares Nasdaq Blockchain Economy Index.

Is this application the one who gets accepted? We will find out soon. The most important thing is that, whatever ETF appears first in the US market, it could be the first step in attracting some serious institutional investors to join the cryptocurrency market. And that could be the key to unlock the next bull run.

Image courtesy of Pixabay.

Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

Ric Edelman: A Bitcoin ETF is on the way

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Creating a Bitcoin ETF has been a priority for many influential crypto players for months already (maybe more). But the road to an ETF has been almost as hard as Frodo’s road to Mordor.

Ric Edelman’s opinion

But Ric Edelman, founder of Edelman Financial Engines, appeared earlier today at CNBC’s ETF Edge at the Inside ETFs Conference in Hollywood, Florida. He had this to say on the subject:

“It’s virtually certain. The only question is when” then he continued: “The SEC has several legitimate thoughtful concerns that the industry has to overcome but I’m confident they will. Eventually, we will see a bitcoin ETF and it’s at that stage that I will be much more comfortable recommending that ordinary investors participate.”

The Securities and Exchange Commission (SEC) has been walking with led shoes on the subject of cryptocurrencies. Are some of them securities? Are some of them actual money? And how can you tell the difference? Should these assets be available for the market at large?

And how should they be regulated? SEC has provided us with some answers to those questions, but some questions still remain, and they are getting on the way of mainstream adoption.

SEC’s decisions will be important because Bitcoin still lacks a secure chain of custody (in traditional terms, in practical terms, Bitcoin’s blockchain is most likely much safer than the traditional mechanisms).

On the other hand, SEC’s decisions will apply to the US only, which is not that important in crypto compared with Japan, China or Korea, so it will have no way of affecting international price flows or to governate trading platforms based overseas.

The big boys are interested

Mr. Edelman also explained that major financial institutions are interested in finding a solution that enables them to get a piece of the crypto action, and that could be enough for an ETF to go online eventually. The market is already there.

“We’ve got some serious players. Fidelity has made a major announcement in the custody issue. We’ve got Kingdom Trust and a number of other very serious players on the custody side. I’m confident that in very short order VanEck or Bitwise will satisfy the custody concern to the SEC,” according to Mr. Edelman.

Tom Lyndon has an opinion too

Tom Lydon, who is ETFTrends.com editor-in-chief joined the conversation to add that he already sees a huge demand for something like a Bitcoin ETF.

“There is pent-up demand. We interview advisors all the time. Seventy-four percent say they’ve talked to clients about their interests in bitcoin, so they need to step up when this happens because that money is going to go elsewhere,” Lydon contributed.

VanEck and SolidX are trying to get an SEC authorization to come up with the world’s first Bitcoin ETF. But they withdrew their application because Trump’s government shutdown could complicate things too much to get a resolution in time.

And why does any of that matters to you or me? Because many experts agree on something: the next bull run in crypto will be driven, at least partially, by institutional investors. So far, crypto’s players are small investors for the most part, and an ETF would be one of the ingredients that could change the market for good.

Image courtesy of Pixabay.

Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.