5 companies that have applied for a spot bitcoin ETF
Date: 2023-06-26 Author: Karina Ziganova Categories: BLOCKCHAIN
The first application for a spot bitcoin ETF in the United States was filed back in 2013, but for 10 years the American financial regulator has not given the green light to any company, and the BTC exchange-traded fund has become something of a holy grail for members of the crypto community.
An ETF is a publicly traded investment vehicle that tracks the value of an underlying asset. In the case of a spot bitcoin ETF, such an asset is BTC. Proponents of this idea believe that the current infrastructure of cryptocurrency exchanges is too complicated for beginners and stops them from buying. In addition, some institutional players are unable to directly invest in cryptocurrency due to legal restrictions. Thus thus, a spot ETF will allow them to access bitcoin without having to buy and store coins themselves.
The editors of BeInCrypto have compiled a list of companies that have applied for bitcoin ETFs and are awaiting their consideration by the US Securities and Exchange Commission (SEC) in the near future.
1. BlackRock
On June 15, investment giant BlackRock, which had more than $9 trillion under management for Q1 2023, shocked the world of traditional finance by applying to launch the iSHARES BITCOIN TRUST spot ETF. According to the details of the document, the Coinbase cryptocurrency exchange will act as the cryptocurrency depository and data provider, and BNY Mellon will be engaged in cash storage.
According to Bloomberg senior ETF analyst Eric Balchunas, BlackRock's application has a huge chance of being approved. The company has already confronted the SEC many times, and the regulator rejected its petition only once.
Galaxy Digital CEO and well-known cryptocurrency supporter Mike Novogratz believes that the launch of the BlackRock spot bitcoin ETF will be the best event that can happen to the main cryptocurrency, and potentially provoke the growth of its quotes to a new historical high.
2. WisdomTree
New York-based company WisdomTree already has experience in managing bitcoin ETFs: in 2019, it launched a spot fund on the Swiss exchange SIX. In March 2021, WisdomTree filed an S-1 application with the U.S. Securities and Exchange Commission, proposing to list WisdomTree Bitcoin Trust shares on the Cboe bZx exchange under the ticker BTCW.
However, the first attempt was unsuccessful. The SEC postponed consideration of the application for several months: first, the regulator invited members of the public to express their opinion on the proposal, and then announced that it needed additional time. At the end of 2021, the Commission issued a decision to refuse - however, a few days ago, WisdomTree filed a new application, inspired by BlackRock's actions.
3. Invesco GalaxyBitcoin ETF
Galaxy Digital and Invesco filed a joint application to launch a spot bitcoin ETF on September 22, 2021. The sponsor of the application is a subsidiary of Invesco Ltd Invesco Capital Management LLC, the fourth largest ETF provider in the United States.
"For those who have been in the ETF business for a very long time, what is happening now is incredibly similar to the early days of ETFs in the late 1990s and early 2000s," said John Hoffman, head of ETF strategy at Invesco in the United States.
The bitcoin ETF will be the first of a number of cryptocurrency funds that the duo of Galaxy and Invesco hopes to list on American exchanges. Like WisdomTree, the companies filed a new filing with the SEC right after BlackRock.
4. Valkyrie Investments
Valkyrie entered the race to launch a Bitcoin ETF in January 2021. According to the application filed by her, the ETF will use the base price of BTC on the Chicago Mercantile Exchange and trade on the NYSE Arca. Secure storage of assets will be provided by the Xapo custodian.
By early 2022, Valkyrie managed to secure approval for the Bitcoin Mining ETF, which is backed by shares in public mining companies — including heavyweights such as Argo Blockchain, Bitfarms, Cleanspark, Hive Blockchain, and Stronghold Digital Mining. A few days ago, the investment firm re-registered the spot Bitcoin ETF with the SEC. In the event of a positive outcome, the fund is expected to list shares on the Nasdaq under the ticker BRRR.
5. Ark Invest
Cathie Wood-led investment firm Ark Invest applied to create the Ark21Shares ETF in June 2021. To launch it, it has partnered with Swiss exchange-traded fund provider 21Shares AG: if approved, it will be traded on Cboe's BZX Exchange under the ticker ARKB.
Ark Invest already has experience with bitcoin and is actively investing in the Coinbase cryptocurrency exchange, Grayscale Bitcoin Trust and the Square payment processor, which has more than 8,000 BTC on its balance sheet
The company was also the first to disclose information about commission fees. The statement indicates that they will be 0.95% and will be paid to 21Shares, which uses this money to cover operating expenses.
Cathie Wood's first attempt to launch an ETF failed in early 2022. Immediately after that, the company re-applied, but it also failed - in January 2023, the SEC refused it. Now Ark has sent the third petition to the regulator.
