Cryptocurrencies, because the OK Sec of an ETF with exposure to Bitcoin is revolutionary
by Chiara Rossi
In the United States, the SEC has approved an ETF that invests in technology companies with bitcoin exposure including Tesla, Square, Coinbase, PayPal and Twitter
Step forward by the United States Securities and Exchange Commission (Sec) – the American Consob – towards cryptocurrencies.
On October 5, the SEC approved a Volt ETF (Exchange Traded Fund) that invests in technology companies with exposure to bitcoin and supporting infrastructure. The portfolio includes Tesla and Twitter companies.
As Business Insider points out, this marks a significant step forward for the cryptocurrency market. So far, the SEC has not approved ETFs with direct exposure to bitcoin.
But this new exchange-traded fund could be as close to investors as possible to have a US bitcoin ETF, analysts believe.
Meanwhile, Bitcoin, after a stellar run during the week, up 25% on Friday, saw a slight drop in valuation to 2.84%. After surpassing $ 56,000 on Thursday, the world’s highest-value cryptocurrency traded at around $ 55,500. Bitcoin’s rapid surge this week stopped well below its all-time high of around $ 65,000, but with a market cap of over $ 1 trillion, on the back of good news for the industry.
All the details.
SEC APPROVES VOLT EQUITY ETF
The US Securities and Exchange Commission has approved Volt Equity’s ETF, which aims to monitor companies that hold the majority of their net assets in bitcoin or derive most of their profits or income from bitcoin-related businesses such as the mining, lending or manufacturing mining equipment, Tad Pak, CEO of the fund, told Insider.
The prospectus defines these companies as Bitcoin Industry Revolution Companies.
WILL NOT INVEST DIRECTLY IN BITCOIN BUT ALMOST
As a result, Volt Etf will not invest directly in bitcoin. Instead, it seeks to put at least 80% of its net worth in “companies of the bitcoin revolution”, options and ETFs with exposure to those companies. The remainder will go into broad equity markets to offset the portfolio risk.
THE SHARES OF TESLA, SQUARE AND PAYPAL IN THE FUND
Pak added that the fund will consist of shares of around 30 companies, including Tesla, Square, Coinbase, and PayPal. He also said Volt has decided to include Twitter, which recently included Bitcoin in its operations, and Bitcoin mining companies like Marathon which also hold the currency in their corporate treasuries.
THE FUND PROJECTS
CEO Pak told Insider that he hopes to go public on the New York Stock Exchange in the next three weeks.
“I am a strong supporter of bitcoin and I was really excited to launch an ETF that could take advantage of the upcoming bitcoin revolution,” he told Insider. “We can get exposure to bitcoin without necessarily holding the currency, especially with options positions.”
APPROVAL OF BITCOIN ETFS POSTED
This indirect investment strategy is necessary because the SEC under the presidency of Gary Gensler has postponed the approval of bitcoin ETFs amid fears of potential market manipulation, Insider recalls. The United States has not yet approved one.
According to Eric Balchunas, Bloomberg’s Senior ETF Analyst, the first Bitcoin futures ETFs are very likely to be approved by the end of October.
ALREADY AVAILABLE IN CANADA
In Canada, however, bitcoin ETFs are available.
Like the Canadian Purpose Bitcoin ETF: it got the green light earlier this year and was a huge success among institutional investors.