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ARK’s amended spot Bitcoin ETF filing is a ‘good sign’ of future approval

October 12, 2023 Coin Telegraph

21shares

ARK Invest and 21Shares amended spot Bitcoin ETF filing seemingly addresses earlier concerns highlighted by the SEC, which is a good sign of progress, according to Bloomberg's ETF analysts.

A recent amendment to ARK Invest and 21Shares’ joint spot Bitcoin (BTC) exchange-traded fund (ETF) application could be seen as a “good sign” of progress and impending approvals.

An amended Oct. 11 filing to the Securities and Exchange Commission for approval adds additional information about the proposed spot Bitcoin ETF, including practices for how the fund will custody assets and determine asset values.

Bloomberg senior ETF analyst Eric Balchunas said the changes could be in direct response to concerns the SEC has asked ETF issuers to address.

“It means ARK got the SEC's comments and has dealt with them all, and now put [the] ball back in [the] SEC's court,” Balchunas said. “[In my opinion] good sign, solid progress.”

There's 5 extra pages in new S-1 but the new stuff is sprinkled throughout like the two above egs. So what does this mean? It means ARK got the SEC's comments and has dealt with them all, and now put ball back in SEC's court. IMO good sign, solid progress.
— Eric Balchunas (@EricBalchunas) October 11, 2023

Balchunas said the changes are “sprinkled throughout,” making the new filing five pages longer, adding in a separate post that “none of the comments were that new or insurmountable.”

Changes included ARK noting the fund’s net asset value (NAV) calculations are not in line with the Generally Accepted Accounting Principles (GAAP) — an accounting standard used by the SEC, said Balchunas.

The new filing also clarifies the ETFs assets, held by Coinbase Custody, are in “segregated accounts [...] And are therefore not commingled with corporate or other customer assets."

This is also new (and again something we heard SEC asked about): "The Trust’s assets with the Custodian are held in segregated accounts on the bitcoin blockchain, commonly referred to as “wallets,” and are therefore not commingled with corporate or other customer assets." pic.twitter.com/57TmnNi1lE
— Eric Balchunas (@EricBalchunas) October 11, 2023

Fellow Bloomberg ETF analyst James Seyffart added in and X post the latter change signals that ARK and others are communicationg with the SEC about what the regulator wants cleared up.

“Good sign for future approval IMO,” he added.

Van Buren Capital general partner Scott Johnsson noted another new addition was a comment that if BTC is increasingly used for illegal purposes and if Bitcoin mining’s environmental impact causes it to be restricted then the ETF’s value could fall.

Still chuckling a bit at this “electricity usage” risk factor. Ark couldn’t even be bothered to put in a coherent header summary or more than a couple short sentences. You know the convo w/ the SEC was like “oh yea, good call Mr. SEC attorney, this is definitely material /s” https://t.co/unIArFDKl8
— Scott Johnsson (@SGJohnsson) October 12, 2023

Johnsson said based on ARK’s amendments it “doesn't look like the agency is putting up any unnecessary roadblocks via disclosure review.”

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Bitcoin ETF would be the ‘seal of approval’ from SEC: Mike Novogratz

July 13, 2023 Coin Telegraph

bitcoin etf

The Galaxy Digital founder believes approval of a spot Bitcoin ETF would essentially be a United States regulator and government nod for Bitcoin.

The approval of a spot Bitcoin (BTC) exchange-traded fund (ETF) would equate to a “seal of approval” for Bitcoin from the United States government and its securities regulator, says Mike Novogratz.

In a July 12 interview with Bloomberg TV the founder of crypto investment firm Galaxy Digital spoke about the multiple spot Bitcoin ETF filings before the Securities and Exchange Commission (SEC), including one from the $10 trillion asset manager BlackRock.

“What I do think is BlackRock, Invesco [and] the group of ETF providers is a real signal that adoption is coming,” Novogratz said.

He added many are “nervous” about investing in crypto and the approval of a spot Bitcoin ETF would be an “easy first step” for most to start investing in the asset.

“I just think if it happens it's the seal of approval from the SEC and the U.S. government.”

Novogratz explained there is a “giant infrastructure” in place for the ETFs. Along with BlackRock, proposed ETFs from Valkyrie, Invesco, VanEck, WisdomTree, Fidelity and a joint fund by ARK Invest and 21Shares are also lined up for approval. Novogratz believes that many of these will likely end up being approved.

“The SEC is not going to approve one so you're going to have these giant sales forces out there giving access to people that didn't have access before.”

SEC chair Gary Gensler has previously claimed that “everything other than Bitcoin” falls under his agency’s purview and other crypto projects “are securities" as there are typically known developers and profits are anticipated based on their work.

Novogratz was evasive when asked his thoughts on if Galaxy and Invesco’s spot Bitcoin ETF would be able to list before the end of the year.

“This SEC has been really stubborn and really tough on crypto,” he said.

“No one of significance has gotten through the listing process. We are in that process and it has been a long and frustrating path. I'll leave it at that,” he added.

“I think we're probably going to need either a change of heart at the SEC or a change of administration to see real progress in crypto regulation here in the U.S.”

Novogratz predicted the price of Bitcoin will end the year at a high. “If you take out the top we’ll have a nice leg up,” he said.

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Third time’s the charm? ARK and 21Shares again file with SEC for Bitcoin ETF

April 26, 2023 Coin Telegraph

21 Shares

Cathie Wood’s ARK and crypto investment firm 21Shares are tripling down on their attempt to get approval to create a spot Bitcoin ETF in the U.S.

Cathie Wood’s ARK Invest and European crypto investment firm 21Shares are seemingly unperturbed by the cryptocurrency regulatory environment in the United States, again requesting approval for a Bitcoin (BTC)-based financial product.

On April 25, the two companies requested that the U.S. Securities and Exchange Commission (SEC) approve the creation of a spot Bitcoin exchange-traded fund (ETF) despite being rejected twice before.

The two companies first applied to create their spot Bitcoin ETF on June 28, 2021, which was later rejected by the SEC in April 2022. The regulator said the product did not meet the requirements of listing a financial product under its rules of practice as well as those of the Exchange Act.

The pair filed another request for a second time in May 2022, an application the SEC rejected again on Jan. 26 this year.

An ETF allows investors exposure to a particular asset without actually owning the underlying financial product. A spot Bitcoin ETF allows investors to gain indirect exposure to the cryptocurrency with shares that track BTC’s price in real-time without actually holding Bitcoin.

While the SEC has approved a number of Bitcoin Futures ETFs — that expose buyers to the potential future value of BTC — it has so far rejected every application for a spot Bitcoin ETF citing difficulties with “protecting investors and the public interest” against fraud and manipulation.

According to ETF analysts from Bloomberg, it seems likely that a spot Bitcoin ETF could become a reality in the U.S. midway through this year.

New note out on why we think spot bitcoin ETFs will get approved in early Summer 2023. The SEC is proposing to expand the definition of "exchange" which would bring crypto platforms under SEC reg. After that (which could take a year) look for ETFs to get green light via @JSeyff pic.twitter.com/TtFgFXrJ8h
— Eric Balchunas (@EricBalchunas) March 24, 2022

Crypto conglomerate Digital Currency Group (DCG) is currently seeking to convert its flagship Grayscale Bitcoin Investment Trust (GBTC) into a spot Bitcoin ETF and has sued the SEC for rejecting its proposal.

Grayscale chief legal officer Craig Salm said in a tweet on Jan. 12, “The case is moving swiftly. While timing is uncertain, oral arguments may be as soon as Q2 [2023].”

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ETH products grow in August as BTC products dip: CryptoCompare report

August 31, 2022 Coin Telegraph

assets under management

The upcoming Merge has contributed to a rise in Ethereum investment products and trading volume, as crypto market AUM figures continue to drop amid the bear market

Ethereum investment products increased by 2.36% to $6.81 billion in assets under management (AUM) throughout August, outperforming Bitcoin products which saw a 7.16% drop off to $17.4 billion.

The figures were contained in a new report by CryptoCompare.

This was also reflected in the Bitcoin (BTC) and Ethereum (ETH)-product trading volumes, with Grayscale’s most notable Bitcoin product, GBTC experiencing a 24.4% drop in volume, while its Ethereum product, GETH actually increased 23.2%. CryptoCompare's report suggeste the highly anticipated Ethereum Merge was the cause behind the change in trading volumes:

Indeed, even at a more granular level, no Bitcoin products covered in this report saw AUM or volume gains in the month of August. We could be seeing interest move away from Bitcoin in the short term, as Ethereum-based products hold the attention with the much-anticipated merge on the horizon.

Monthly AUM figures for digital asset investment products fell 4% overall, which was largely attributed to 6% fall from Grayscale’s GBTC product, as it accounts for $13.4 billion of the total $25.8 billion of digital assets under management (53.4%).

The largest inflows came from products falling under the “Other” umbrella, representing non-Bitcoin and Ethereum products, which saw a 12.3% increase to $1.13 billion over the first three weeks, according to the report.

*Monthly AUM figures for digital asset investment products have steadily dropped throughout the bear market. Source: Crypto Compare.*

Despite the bear market, a number of highly-regarded financial institutions have launched crypto investment products throughout the month of August. These products have come in the form of Exchange Traded Funds (ETFs), Exchange Traded Certificates (ETC), Exchange Traded Notes (ETN) and Trust products.

Among the most notable was BlackRock’s private spot Bitcoin Trust, a move which brought about a “here comes Wall Street” response from former Grayscale CEO Barry Silbert. The launch of the Bitcoin Trust from the world’s largest asset manager came following its partnership with Coinbase to provide its clients with institutional trading services.

Charles Schwab was another financial institution to make a play this month, having launched its own “Schwab Crypto Thematic ETF”, tickered STCE on the New York Stock Exchange, which provides exposure to a mix of mining and staking companies, along with several blockchain-based applications.

BetaShares launched Australia’s first Metaverse-focused ETF on the Australian Stock Exchange (ASX), along with a new Metaverse and nonfungible token (NFT) focused ETF launched by finance firm SoFi.

Two more spot crypto ETFs launch on Australian markets

June 7, 2022 Coin Telegraph

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Both of the new Australian exchange-traded funds by 3iQ Digital Asset Management will feed from its existing Bitcoin and Ethereum ETFs listed on the Toronto Stock Exchange.

A further two cryptocurrency-backed exchange-traded funds (ETFs) have launched on the Cboe Australia exchange on June 7 bringing the total amount of crypto ETFs available to Australian traders to six.

The Canada-based 3iQ Digital Asset Management (3iQ) launched two spot ETFs, the 3iQ CoinShares Bitcoin (BTC) Feeder ETF and the 3iQ CoinShares Ether (ETH) Feeder ETF.

Both of the Australian funds feed from the firm's Canadian ETFs listed on the Toronto Stock Exchange (TSX), the 3iQ CoinShares Bitcoin ETF, and the 3iQ CoinShares Ether ETF. The underlying assets of the Canadian ETFs are holdings of BTC and ETH held in cold storage by the Gemini crypto exchange.

3iQs funds join the Bitcoin and Ethereum backed funds by 21Shares and Cosmos Asset Management the latter of which saw launch delays in April due to a still-unnamed service provider needing time to support the launch.

Three ETFs, a Bitcoin and Ethereum ETF by 21Shares and a Bitcoin ETF by Cosmos eventually opened to trading in early May becoming the first crypto ETFs in Australia. Cosmos later released an Ethereum-backed fund on May 31.

Much like 3iQ funds, the underlying assets for the Cosmos ETFs are direct investments into the Canadian Purpose Bitcoin and Ethereum ETFs whilst the funds issued by 21Shares are backed by Bitcoin and Ethereum reserves held in cold storage by Coinbase.

A point of difference is that 3iQ boasts is having the lowest expense ratio out of the six, at 1.2%, — 0.05% lower than the 21Shares and Cosmos ETFs each with an expense ratio of 1.25%.

The three original funds by 21Shares and Cosmos had a sluggish start to trading only seeing $1.3 million in volume on the day of launch, far below the estimated $1 billion of expected inflows. The two 21Shares funds received a total of around $936,500 of total inflows, whilst Cosmos’ Bitcoin fund received just over $398,000.

According to data from Cboe at the time of writing, the two 3iQ ETFs have seen a volume of 13,592 and 9,754 shares traded of the Bitcoin and Ethereum ETFs, accounting for around $73,415 and $73,605 respectively to a total of over $147,000, much smaller than its competitors.

Aussie crypto ETFs see $1.3M volume so far on difficult launch day

May 12, 2022 Coin Telegraph

Aussie crypto ETFs see .3M volume so far on difficult launch day

21 Shares

The trio’s launch marks the first crypto ETFs to go live in Australia, with two of them focused on offering exposure to BTC and the other focused on ETH.

With crypto markets tanking, three crypto-focused exchange-traded funds (ETFs) picked a difficult day to commence trading on local exchange Cboe Australia today.

The trio’s launch marks the first crypto ETFs to go live in Australia, with two of them focused on offering exposure to Bitcoin (BTC) and the other focused on Ethereum (ETH).

So far the three ETFs have generated more than $1.3 million between them, and it has been estimated that they could see around $1 billion worth of inflows moving forward.

The Cosmos Purpose Bitcoin Access ETF (CBTC) from Sydney-based crypto investment firm Cosmos Asset Management offers a relatively indirect route to BTC, as it “approximately tracks the performance of the USD denominated ETF non-currency hedged units (Purpose ETF Units) in the Purpose Bitcoin ETF.”

The other two ETFs were developed by ETF Securities in partnership with major Switzerland-based exchange-traded products (ETP) provider 21 Shares. The funds are called the Bitcoin ETF (“EBTC”) Ethereum ETF (“EETH”). They both track the Australian dollar (AUD) value of their respective assets.

According to Cboe data at the time of writing, 21 Shares EBTC and EETH have seen 125,271 and 142,206 shares trade hands, which accounts for roughly $519,874 and $416,663 in volume respectively.

Cosmos Asset Management’s fund has had a relatively slower start at 51,572 shares traded for a total of $398,135, however activity could soon pick up as given that the firm has waived fees on CBTC for two months to attract institutional interest.

Speaking on the launch with Cointelegraph, ETF Securities Head of Distribution, Kanish Chugh noted that while it was a difficult time to launch amid the crashing crypto market, it also provides investors with a reasonable chance to get some skin in the game:

“Given how volatile markets are now in the short term it will be hard to determine how Bitcoin and Ethereum will perform. What we are seeing though is with Bitcoin coming off more than 50% from its 2021 high, investors are considering the current volatility as providing them with an opportunity to invest. “

“Our crypto ETFs are physically backed and tracks the underlying price of Bitcoin and Ethereum and we have high hopes that EBTC and EETH will be a success in the long term,” he added.

In a public announcement, ETF Securities Chairman Graham Tuckwell also emphasized the significance of launching crypto ETFs in a local context given the stature of BTC and ETH.

“The market capitalization and trading volumes for these two leading cryptocurrencies are now larger than any company listed on the Australian stock exchanges, yet investors have not been able to gain access to them in a regulated manner,“ he said.

Not everyone was as bullish despite the landmark moment however, with Kraken’s Managing Director for Australia Jonathon Miller hailing this “significant milestone for the maturation of the digital assets space” while pointing out investors could already buy Bitcoin.

“However, it isn’t necessarily a watershed moment for accessibility. We must remember that individual investors can already buy Bitcoin directly and each layer of abstraction away from the underlying asset can add risk and cost,”

Three new crypto ETFs to begin trading in Australia this week

May 10, 2022 Coin Telegraph

21shares

Australians will soon have five options for cryptocurrency exchange-traded funds as the delayed funds from Cosmos and 21Shares launch this week along with 3iQ’s in the future.

Australians will soon have more options for spot cryptocurrency exchange-traded funds (ETFs) after a previous hold-up was given the green light this week and new funds entered the ETF market.

The latest update came late on May 9 as Cboe Australia issued a round of market notices that three funds previously delayed are expected to begin trading on Thursday, May 12. They include a Bitcoin ETF from Cosmos Asset Management, plus Bitcoin (BTC) and Ethereum (ETH) spot ETFs from 21Shares.

Cboe Australia and Cosmos did not immediately respond to a request for comment, but a spokesperson from 21Shares confirmed to Cointelegraph:

“We're listing on May 12, this Thursday. The downstream issues are resolved.”

On April 26, a day before three of the first crypto ETFs were set to launch, the Cboe Australia exchange delayed the listing of all three funds due to what it said were “standard checks”.

21Shares said to Cointelegraph at the time that a "service provider downstream” needed more time to support the launch of the products which was believed to be a prime broker or other major financial institution.

The listing date comes just in time as a new competitor stepped into the ETF race. 3iQ, the Canadian firm with Bitcoin and Ethereum spot ETFs listed on the Toronto Stock Exchange (TSX), submitted two offer notices to the Australian Securities Exchange (ASX) on April 28.

The notices revealed plans for the firm to offer units of its Bitcoin and Ethereum ETFs on the Cboe Australia exchange. It will provide exposure to the crypto assets by purchasing units of the existing funds on the TSX similar to Cosmos’ ETF which purchases the Canadian Purpose Bitcoin ETF.

It’s unclear when the funds from 3iQ will be listed but with the announcement of the Cosmos and 21Shares funds listing this week, it’s unlikely 3iQ will win the competition of being the first Australian crypto ETF, the prize of which it’s believed could be over $1 billion in inflows.

crypto etf