If it looks like just another headline, look again – the announcement that ProShares is going to operate a Bitcoin ETF starting at the end of this week is really big news.
A couple of years ago, we started covering multiple applications to the U.S. Securities and Exchange Commission for these types of funds which could provide major on-ramps to crypto investing for smaller retail investors.
One after the other, the SEC knocked these projects down.
The process wasn’t always straightforward, either – on at least one occasion, the SEC used a lengthy public review period to dilly-dally before eventually squashing Bitcoin ETF plans.
In coverage at Coindesk, Jamie Crawley suggests Gary Gensler is more likely to look favorably at Bitcoin ETFs that have to do with Bitcoin futures rather than the asset itself.
“With the SEC mulling dozens of bitcoin ETFs, Chairman Gary Gensler has made it clear that funds linked to the futures market rather than the underlying asset were more likely to win regulatory approval,” Crawley writes.
This, however, is probably splitting hairs. Investors will likely latch on to anything that offers a convenient entry-level way to get involved with Bitcoin value.
The rollout of the Purpose Bitcoin ETF in Canada months ago may have had something to do with SEC’s sudden thaw on the idea of having the U.S. Bitcoin ETFs in action.
The bottom line is you can expect to see more of this type of activity and the new ProShares fund will give us a benchmark on how popular the concept is.
An exchange traded fund offers all comers the opportunity to easily buy and sell an asset based on underlying equities or values during a market day.
“Like a mutual fund, an ETF is an investment structure that pools the assets of its investors and uses professional managers to invest the money to meet clearly identified objectives, such as current income or capital appreciation,” writes Ken Hawkins at Investopedia. “And, like a mutual fund, it also has a prospectus. An ETF delivers a prospectus to the retail purchaser or provides investors a document known as a product description, which summarizes key information about the ETF.”
Next week will be an interesting time for cryptocurrency markets.