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Inverse Bitcoin ETF beneficial for crypto: Grayscale CEO

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Grayscale CEO Michael Sonnenshein recently asserted on Twitter that the introduction of the first short Bitcoin exchange-traded fund (ETF) in the United States could be encouraging for the cryptocurrency sector.

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He thinks that the U.S. Securities and Exchange Commission’s approval of new BTC-related goods shows that the powerful regulator is gradually growing more at ease with the biggest cryptocurrency.

According to U.Today, on Tuesday, trading on the New York Stock Exchange (NYSE) began for the ProShares Short Bitcoin Strategy (BITI), which provides exposure to the inverse performance of the biggest cryptocurrency.

The SEC’s approval of ProShares’ Bitcoin futures ETF in October was seen as a turning point for the cryptocurrency market and rekindled the second stage of the 2021 bull run.

But the authority has so far turned down every application to allow a spot-based Bitcoin ETF. Currently, Grayscale is putting up a valiant campaign to persuade the SEC to turn its flagship trust into an exchange-traded fund. Sonnenshein has nevertheless emphasized that he is not identifying the recent correction’s bottom.

BTC’s price dropped to $17,500 on Saturday, but it was able to launch a small comeback after that. The top cryptocurrency experienced a rise on Tuesday, reaching a high of $21,708.

Bitcoin to Test $17,000 Again?

Former NYSE Group President Tom Farley recently claimed that the price of Bitcoin may end up retesting the $17,000 level during an appearance on CNBC.

Yet he considers the current price decline to be a “very wonderful” purchasing opportunity, suggesting that the cryptocurrency has at least temporarily struck a bottom. Farley is of the opinion that the market has already capitulated.

After a protracted run of losses, the largest cryptocurrency in the world was able to retake the $21,000 mark earlier today, marking a tiny success for bulls.

Arthur Hayes, the former CEO of BitMEX, forewarned on Monday that there would be additional forced selling as a result of market uncertainty. In the past, Paul Krugman, a Nobel Prize-winning economist, warned that the tiny comeback would just be a dead-cat bounce.

Chris Burniske, a cryptocurrency analyst, recently tweeted that he would not be surprised if BTC fell under the $10,000 mark. There is more possibility for a downturn because miners have not yet given in. Burniske also thinks that the unfavorable macro environment will make it difficult for Bitcoin to recover.

ProShares Debuts First Short Bitcoin ETF [BITI]

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ProShares is all set to unveil its first short bitcoin-linked ETF in the United States under the ticker BITI. The new fund will go live on the New York Stock Exchange NYSE.

According to the press release, BITI will provide investors a chance to profit from Bitcoin’s price dip or protect market exposure with the convenience of an ETF. Speaking of the new launch, ProShares CEO Michael L. Sapir stated,

“As recent times have shown, bitcoin can drop in value. BITI affords investors who believe that the price of bitcoin will drop an opportunity to potentially profit or hedge their cryptocurrency holdings. BITI enables investors to conveniently obtain short exposure to bitcoin through buying an ETF in a traditional brokerage account.”

Back in October 2021, ProShares created history when it successfully launched BITO, the first U.S. bitcoin-linked ETF, raking over $1 billion in assets in just two days.

The leading ETF issuer also curated the first BTC-linked mutual fund, BTCFX, in July 2021.

However, Bitcoin ETFs were being bamboozled as stocks trade sharply lower amid fears of a looming recession, with investors anticipating that the Federal Reserve may adopt a more hawkish stance by raising rates to curb surging inflation.

ProShares ETFs value dropped by 70%  

Last week, the performance of these exchange-traded funds that track Bitcoin through managed futures contracts was at their worst as these asset classes were trading all-time lows in the wake of a severe downswing in the crypto market.

As per various reports, the ProShares Bitcoin Strategy ETF, in particular, has fallen almost 70%.

In addition to that, other top ETFs Valkyrie Bitcoin Strategy ET and VanEck Bitcoin Strategy ETF have all hit record lows in the wake of the mega BTC selloff.

Bitcoin has dropped 69% from its previous peak, falling 55% this year alone, as as result the ETFs troupe went belly up.

The report also notes that the popular Grayscale Bitcoin Trust has been trading lower this year, by 60.1%. That’s not its lowest level on record, but it is a 20-month low for the fund.

Grayscale doubles down on its efforts for a Spot Bitcoin ETF

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Asset management firm Grayscale has renewed efforts to gain permission from the US securities watchdog in converting the world’s largest crypto investment vehicle into an exchange-traded fund.

As per a letter sent to the regulator, the asset manager is bolstering its application with the Securities and Exchange Commission to convert its $40 billion Bitcoin Trust into a spot Bitcoin ETF.

The latest move from Grayscale comes as the SEC is contemplating whether to give the green signal for US exchange-traded funds to hold bitcoin, rather than derivatives linked to the cryptocurrency, for the first time.

The investment firm is currently awaiting to hear back from the SEC in early July on a decision that would change its Bitcoin Trust into an ETF. If they are rejected, Grayscale Investments CEO Michael Sonnenshein has hinted that it is willing to flip the script and take SEC to court.

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While there is no doubt that Grayscale’s CEO has been one of the vocal SEC critics, he is not alone. In an interview, this month, Bitwise Asset Management’s Matt Hougan took note of the fallacy and said,

“The SEC is objecting on the grounds of manipulation concerns, but its specific request was to demonstrate that regulated CME markets are of significant size. Bitcoin is now an institutional market. It’s a market with institutional service providers, institutional investors, and a large and robust regulated futures market.”

Grayscale’s gambit is monumental for the crypto industry

Several other crypto firms have already been reprimanded in their attempts to open similar funds and Grayscale’s gambit represents one of the crypto industry’s last hopes of launching such a product in the near future.

But that has hardly acted as a deterrence. As ETF Trends CEO Tom Lydon pointed out that a growing number of financial advisors are interested in investing in a bitcoin ETF.

A 2022 Bitwise/ETF Trends Survey revealed that 82% of advisors prefer a spot bitcoin ETF over a futures-based alternative. The demand has also increased for bitcoin products that investors can purchase on traditional brokerage platforms, Lydon said.

Right now, there are not many choices, so it’s not going backward, he added. Crypto experts are still hopeful a spot bitcoin ETF could make its entry as early as this year.

Australia Gets the Green Light to List Its First Bitcoin ETF Next Week

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According to the Australian Financial Review, Australia’s bitcoin exchange-traded fund (ETF) is poised to debut on the Cboe next week, as the country’s largest equities markets clearinghouse gives participants the green light.

According to the article, Cosmos Asset Management might launch its bitcoin ETF as early as April 27.

However, unlike other comparable products globally, Australia’s first Bitcoin ETF would invest in shares of Purpose Investment’s bitcoin ETF – North America’s first bitcoin spot ETF that began trading in early 2021. In February, Cosmos teamed with Purpose Investments.

Australia’s bitcoin ETF might attract $1 billion

To let a bitcoin ETF begin trading under its cover, ASX Clear wanted a 42 percent margin. According to reports, there are currently three institutional clearing participants and one retail clearing participant prepared to offer the required margin to trade a bitcoin contract.

Last year, Cosmos, which Nasdaq-listed bitcoin miner Mawson Infrastructure Group controls, entered the cryptocurrency fund management sector. The entry was along with the Global Digital Miners Access ETF, which invests in bitcoin mining companies.

“We are now at our minimum number of clearing participants and that means we are good to go.”

Hamish Treleaven, chief risk officer at ASX

According to the article, ETF Securities, VanEck Australia, BetaShares, and Monochrome Asset Management are among the asset management firms interested in registering bitcoin-linked ETFs in Australia.

A successful launch, according to Grumelart, will result in an influx of new gamers. “If outside markets are any indicator, a successful debut would almost certainly result in a slew of listings for crypto asset-based funds other than Bitcoin,” he added.

Since last year, when Cosmos launched its Global Digital Miners Access ETF, this will be the firm’s second crypto-related ETF.

Over the last year, the country’s officials have been striving to establish clear laws for the crypto business. Senator Andrew Bragg believes that additional jurisdiction for the Australian Securities and Investments Commission (ASIC) is improper until bitcoin is recognized as a financial asset under Australian law.

SEC plays hardball with BTC ETF approval

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The US Securities and Exchange Commission (SEC) has so far rejected multiple bids to create a spot Bitcoin (BTC) exchange-traded fund (ETF), including those from Fidelity and SkyBridge. However, the lack of investor protection safeguards in the division has been mentioned by the agency as a major cause for the agency’s continued denials.

According to a Monday article by London-based financial publication Financial News, Michael Sonnenshein, CEO of asset management firm Grayscale, has stated that acquiring a spot Bitcoin ETF is the firm’s “number one” goal at the present.

Grayscale applied to convert its Bitcoin trust, which presently manages around $25 billion in the largest cryptocurrency, into a spot ETF last October, as reported by Tron Weekly Journal (TWJ).

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In light of recent events, Grayscale’s proposed rule change is presently up for public comment at the commission. According to Bloomberg’s Eric Balchunas, the vast majority of opinions (approximately 95 percent) were in support of approving the product in February. The overall view seems to be that the commission has already approved multiple futures-based Bitcoin ETFs, so approving a product that follows the value of actual Bitcoin rather than derivatives makes it reasonable.

However, by refusing to authorize a Bitcoin ETF, Grayscale claims the SEC is creating an “unfair playing field.” Sonnenshein, on the other hand, believes the regulator will change its mind in the future.

SEC propels two BTC ETF proposals

The Securities and Exchange Commission (SEC) has approved two more spot bitcoin exchange-traded fund (ETF) proposals, this time from WisdomTree and One River, respectively.

WisdomTree filed a fresh proposal in February, and the 45th day after publication in the federal register, the first window for the commission decision, is March 31. This order gives the new plan an extra 45 days to be considered, pushing the deadline back to May 15. the order read,

“The Commission finds that it is appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and any comments received.”

As for the digital asset fund One River, which is funded by billionaire investor Alan Howard, filed for its One River Carbon Neutral Bitcoin Trust in May 2021. The product would store bitcoin and value its shares, with an additional adjustment to account for the cost of carbon offsets. In October, the proposed rule change was published in the Federal Register for public comment, putting the commission on notice.

The SEC has repeatedly booted the can on this decision, as it has done with other spot bitcoin products. The Commission was supposed to make a decision on April 3, 180 days after the October 5 publication, but the order gives the Commission a further 60 days to make a conclusion on June 2.

Grayscale’s Bitcoin ETF application delayed yet again by SEC

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The U.S. Securities Exchange Commission (SEC) procrastinated its ruling on Grayscale’s pending application over Bitcoin’s exchange-traded funds (ETF) conversion proposal. The crypto asset management platform was seeking approval from SEC to convert its Bitcoin Trust (GBTC) into a well-developed ETF. This conversion was due to the concerns over maneuvering, liquidity, and clarity.

However, the notice published by SEC on Friday, 4 February 2022, didn’t bring something different to the table as it relates to Grayscale’s pending application. In the long notice that was published, the SEC particularly asks for “written comments” from “interested persons” among the general public to explain their “views, data and arguments” referring to the regulator’s concerns of maneuvering, liquidity, and clarity.

The notice goes on to say that the public has 21 days from today, as mentioned in the Federal Register, to submit written data, views, and arguments on whether Grayscale’s application should be granted or denied, with a 35-day window for rebuttal. Additionally, Individuals interested in submitting comments to the SEC can do so either electronically or on paper, according to the notification.

In a tweet, Bloomberg Intelligence’s James Seyffart pointed out that Grayscale’s delay meant an ultimate ruling on the push will be made in early July. He said,

“Annnnndd here it is. The official SEC delay on $GBTC attempt to convert to a spot Bitcoin ETF. 100% expected. Final decision date for $GBTC will be on/around July 6th.”

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Inverse Bitcoin ETF beneficial for crypto: Grayscale CEO 6

SEC’s history of rejecting Grayscale’s spot ETF applications

Grayscale, the world’s largest digital asset management firm, filed an application in October to convert shares of its Trust (GBTC) into a spot Bitcoin ETF, aiming to reverse the regulator’s previous rejections of BTC spot ETF applications. However, the SEC stated two months later that it would be postponing its decision on Grayscale’s application, citing market fraud, manipulation, and transparency as major issues.

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Inverse Bitcoin ETF beneficial for crypto: Grayscale CEO 7

Grayscale has $36.5 billion of assets as of February 4th, according to a tweet, with its GBTC product accounting for almost 71% of total assets. At the time of writing, Bitcoin (BTC) was priced at $41,483.65 and was seen on the bull run of 9.45% over the last 24 hours.

Bitcoin ETF, a first in India

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The launch of India’s first Bitcoin and Ethereum Futures ETF and Metaverse US-listed Large-cap Discount Certificates by Torus Kling Blockchain IFSC, a 50:50 joint venture between Sam Ghosh endorsed Cosmea Financial Holdings (CFH) and Kling Trading India, signed an MOU with India INX has been the hot topic of the hour in the nation, as reported by local media.

These Exchange Traded Funds (ETF) Futures will be barraged under a Sandbox design of IFSCA. This will be the fircrypto-supportedted futures ETF outside of the US and the first Asian Discount certificates trailing Metaverse Large Cap stocks in US and Europe markets.

Torus Kling Blockchain will be at the financial end providing liquidity to India INX by catering to the all-time necessity of deep liquidity with smart order routing. The Torus global distribution team and its partners are accountable for the distribution of the products, according to reports.

Mr. V.Balasubramaniam, the Managing Director and CEO of India INX, said,

“India INX at GIFT IFSC is looking at exploring the launch of Digital Asset based products and has already made an application to IFSCA under Regulatory Sandbox. This is a part of our product innovation initiative to benchmark offerings with other internatiofinancialance centers. We will be launching products in these new-age assets in compliance with the prevailing laws after receiving all required post regulatory approvals”

Bitcoin ETF’s big struggle in the U.S

There have been big battles that were faced to launch the first Bitcoin ETF in the U.S. The reason was that Bitcoin, the largest cryptocurrency in the world, seemed to be unregulated. In addition, the Securities and Exchange Commission (SEC) was hesitant to allow an ETF focused on the then-new and broadly unproven cryptocurrency market to make its way into the community.

After 8 long years of struggle, the first application for a Bitcoin ETF trade, at the New York Stock Exchange (NYSE), was filed in the U.S. The first Bitcoin ETF in the United States began trading on 19 October 2021.

Now, India escalated its game by permitting the launch of not only Bitcoin ETF but also Ethereum futures ETF. This being a first, crypto enthusiasts look forward to more ETFs being launched.

ProShares solicits SEC approval for Metaverse ETF

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After its successful Bitcoin ETF launch in the USA, ProShares now files with the Securities and Exchange Commission (SEC) seeking approval for the launch of Metaverse ETF.

Just a few months ago, back in October, Proshares’s application managed to harvest the approval of the SEC for the Bitcoin (BTC) Exchange-Traded Funds (ETF). That was a benchmark in the Crypto-world as it marked the debut of Bitcoin ETFs in the US.

Now, the first American company to launch a futures-backed Bitcoin ETF in the USA has set sail to the Metaverse arena. Considering, that the SEC did not take too long to officialize the Bitcoin ETF, it will not come as a surprise if the Metaverse ETF bags this approval as well. According to recent filings with the SEC, the Exchange-Traded Fund is called The ProShares Metaverse Theme ETF.

According to sources, Haim Israel, a strategist at the Bank of America, believes that Metaverse could boost the cryptocurrency industry to a higher level and that it could cause digital assets to start being employed widely for financial transactions.

ProShares’s Metaverse ETF to track the who’s-who of tech giants

If approved, the ETF will track companies working on Metaverse-themed initiatives, specifically Solactive Metaverse Theme Index (SOMETAV). The SOMETAV Index will consist of companies providing services around the Metaverse or that employ this type of technology, such as Apple, the GPU manufacturer- Nvidia, Meta (formerly known as Facebook), Alphabet, as well as gaming majors Activision Blizzard, EA, and Take-Two, among others.

The above-said companies are the ones that are rumored to be venturing their future business lines into metaverse like a virtual world, 3-D experience, personal avatars, and so on.

ProShare has not verified that the ETF will have any straight visions on Cryptocurrency or non-fungible tokens (NFT) yet, although some of the indexed companies like Twitter and Meta have already acquainted themselves with the Crypto-world.

ProShares is the most recent firm looking to jump into the fast-evolving Metaverse arena. Not very long ago, Grayscale Investments, the world’s largest digital management firm predicted that the industry would soon be worth over $1 trillion.

Another Spot Bitcoin [BTC] ETF in Canada while the US still awaits

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Fidelity Investments is prepping to launch a spot Bitcoin [BTC] ETF in Canada while its filings for the same are yet to receive the green light from the Securities Exchange Commission [SEC] in the United States. With respect to the financial service firm’s ETF, dubbed as the Fidelity Advantage Bitcoin ETF [FBTC], which would directly acquire physical BTC meaning the investment vehicle would purchase actual Bitcoin rather than obtain it via a derivative instrument.

The latest maneuver provides a much-needed shot to the arm for one of America’s leading brokerage entities having a total of $4 Trillion assets under management [AUM] is catering to its burgeoning clientele based in neighboring Canada. While in its home country, regulators are still figuring out whether or not to allow a spot BTC ETF.

This is not the first time spot BTC exchange-traded fund has been approved. A few days ago, Singapore became the newest entrant as it now offers a ‘Physical’ BTC fund created by its homegrown Fintonia Group. Citing the latest development, Ravi Menon, Managing Director of Monetary Authority of Singapore [MAS], noted that the best approach would be not to impose a total ban on these instruments. Speaking on the choice of the king coin, Adrian Chng of Fintonia reportedly said.

Bitcoin is an excellent form of collateral for loans. It trades 24/7 and is highly liquid, with approximately $30 billion to $60billion per day. If required, it can be quickly liquidated in comparison with, for example, commodities and real assets.

On the other hand, U.S firms’ have struggled so far to gain approval for the spot fund from the country’s top regulator. To top that, the recent development in Canada has irked many in the crypto community. One of them is prominent investor, Lark Davis who expresses his frustration with regards to SEC’s stance.

No Bitcoin [BTC] ETF in US?

So far, the market has welcomed a number of futures ETFs such as the ProShares Strategy and Valkyrie Bitcoin Strategy but the question arises as to when will the U.S. regulatory body would finally approve the first spot Bitcoin ETF? Steven McClurg, the co-founder of Valkyrie, in an interview with CNBC stated that a spot ETF ‘won’t be until at least middle of next year.’ Grayscale Investments, which recently filed to convert the popular BTC trust into a spot ETF, is also eyeing the same by summer 2022.

Even, David LaValle at Grayscale Investments who heads the ETFs division, stated in a MarketWatch interview that he too sees the possibility of regulators giving the green signal for a spot-bitcoin ETF by July next year.

VanEck fails to make it to the cut as SEC throws its Bitcoin ETF proposal out the window

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While the entire community assumed that the US opened the door to an array of Bitcoin ETFs, VanEck’s proposal for an ETF was recently shown the door.

The entire world was stunned following the Securities and Exchange Commission’s [SEC] decision to finally give crypto exchange-traded funds a green signal. Several firms fought long and hard to amass approval from the SEC. However, the financial regulator either delayed or denied the applications. But soon after two Bitcoin ETF applications, from ProShares and Valkyrie, received permission to launch, the community hoped for similar products.

This wasn’t the case as VanEck’s spot Bitcoin ETF proposal got a big no from the SEC. While this decision was time and again delayed by the SEC, it finally decided that the firm wasn’t ready to make its debut just yet.

VanEck’s Bitcoin ETF rejection disappoints CEO

VanEck’s Bitcoin ETF application was delayed back in September and the financial regulator had until 14 November to give its verdict. Days before its deadline, the SEC released a statement dismissing the application and citing concerns about price manipulation.

The safety of the investors happens to be one of the major interests of financial regulators. The VanEck application was rejected as it did not match up to the level of protecting its investors as well as the public interest.

The CEO of the firm, Jan van Eck expressed immense distress over SEC’s decision. Therefore, he took to Twitter and stated,

“We are disappointed in today’s update from the SEC declining approval of our physical bitcoin ETF. We believe that investors should be able to gain #BTC exposure through a regulated fund and that a non-futures ETF structure is the superior approach.”

ProShares made history soon after becoming the first firm to amass the approval of the SEC to roll out a crypto ETF. While this is a futures ETF product, the community was hoping to hoard a spot Bitcoin ETF. This could certainly take a while considering the SEC’s track record.

Additionally, the price of Bitcoin took a massive fall as it dropped to a low of $63K, during the time of writing.