ETFs allow investors to gain exposure to assets without the inconvenience of actually owning those assets. In this context, a Bitcoin ETF may seem counterintuitive. BTC is a digital currency maintained by a decentralized network of nodes. The whole point of Bitcoin is to allow people to serve as their own banks, without the intervention of centralized parties like banks or governments — which prompts this question: Why would investors want to own a Bitcoin ETF in the first place?
Proponents of Bitcoin ETFs believe that they will open the floodgates and give institutional investors greater access to Bitcoin. An ETF is a marketable security that tracks either a basket of securities and assets or commodities, bonds, or foreign currency.
An ETF divides ownership of its assets into shares, which investors can purchase on the stock market. ETFs can also be used to track the value of commodities like gold or oil. The same goes for oil. Unlike gold or oil, BTC is a digital asset that can be purchased easily on a number of exchanges and transferred to a digital wallet.
The Commission steps beyond this limited role when it focuses instead on the quality and characteristics of the markets underlying a product that an exchange seeks to list. Bitwise had previously created the first cryptocurrency-based index fund. The Bitwise proposal would be physically backed by the purchase of bitcoins, with bitcoins being stored and secured by third-party custodians. I hope so, yes, and I think so. Whether a Bitcoin ETF is approved in the next year, or the year after that, the discussion around Bitcoin ETFs have sparked increasing conversation and dialogue between regulators and private companies.
More dialogue provides greater regulatory guidance around Bitcoin, helping to pull the digital currency into the mainstream — and that can only be a good thing.
The above references an opinion and is for informational purposes only. It is not intended as and does not constitute investment advice, and is not an offer to buy or sell or a solicitation of an offer to buy or sell any cryptocurrency, security, product, service or investment.
Seek a duly licensed professional for investment advice. The information provided here or in any communication containing a link to this site is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject SFOX, Inc.
Neither the information, nor any opinion contained in this site constitutes a solicitation or offer by SFOX, Inc. Sign in. Get started. SFOX Follow. A Year History. Bitcoin has come a long way in ten years. We dig into the leading Bitcoin improvement proposals to watch in Prime dealer of cryptoassets for sophisticated traders and institutional investors. Crypto analysis from SFOX, the premier crypto trading venue.
Write the first response. Discover Medium. Make Medium yours. Become a member. About Help Legal.
Robinhood Crypto Trading Is Now Live! - Robinhood Crypto Review
Differences Between ETPs and ETFs