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Bitcoin ETFs Might Start Trading Publicly in the US in the Coming Week

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Bitcoin ETFs Might Start Trading Publicly in the US

The crypto-verse and the exchange-traded fund (ETF) world is preparing to welcome the first Bitcoin (BTC) futures ETF in the coming week. Reportedly, the US Securities Exchange Commission (SEC) will decide the fate of ProShares Bitcoin Strategy EFT on Tuesday, October 18. Should the regulator approve the EFT, it will become available to the public through the New York Stock Exchange (NYSE).

Despite the SEC holding all the cards, crypto enthusiasts are hopeful that the regulator will approve the ETF. An example is Dave Nadig, the Director of Research at ETF Trends, who believes there is a 75% chance that the SEC will approve the ETF, allowing trading to commence as planned.

The SEC also hinted that it might approve BTC futures ETFs, saying,

Before investing in a fund that holds Bitcoin futures contracts, make sure you carefully weigh the potential risks and benefits.

Apart from the ProShares ETF, the SEC is inching closer to passing judgment on four more BTC futures ETFs from VanEck, Invesco, Valkyrie, and Galaxy Digital.

Varying sentiments on BTC futures ETFs

However, it is worth noting that a BTC futures ETF is based on futures that trade on the Chicago Mercantile Exchange. As such, part of the crypto community does not sit right with such ETFs and instead prefers an investment vehicle based on actual BTC.

For instance, Grayscale Investment’s CEO, Michael Sonnenshein, said futures are derivatives of the spot market. He then questioned the SEC’s pending decision, asking why the agency should be comfortable with futures but not the spot market.

Notably, Grayscale has ambitions of rolling out an ETF. The company disclosed that it intends to convert its Bitcoin Trust (GBTC) into an ETF if it gets the regulatory go-ahead.

Unlike Sonnenshein, who is critical about BTC futures ETFs, Matthew Hougan, Bitwise Asset Management’s Chief Investment Officer, the crypto market has to crawl before it can walk and run. Hopeful that BTC futures ETFs can open more doors for the crypto market, Hougan said the least the SEC can do at the moment is to approve the product, seeing as it is regulated.

The SEC does not want to stifle innovation

According to Hougan, the SEC’s Chair, Gary Gensler, wants to support innovation but lacks regulatory authority over key areas like crypto exchanges. Hougan added that Gensler’s approach to fostering crypto innovation involves implementing a regulatory framework to help tackle fraud, illicit activities, and malicious actors.

Putting Gensler’s approach into consideration, Hougan claims that the SEC’s only option to foster innovation without interfering with the work of other agencies would be greenlighting the launch of the ProShares Bitcoin Strategy NFT.

He further pointed out that the BTC futures ETF would help retail investors circumvent problems associated with owning BTC. This is because the investors will not have to worry about the custody of their crypto or about forgetting wallet addresses. Additionally, users will not have to watch out for cybercriminals who target crypto holdings on unregulated crypto exchanges.

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Jinia is a fintech writer based in Sweden focusing on the cryptocurrency market and blockchain industry. Besides Cryptotelegram, she has been writing for some renowned publications such as Cointelegraph, Invezz, etc for years. She also has experience in writing about the iGaming industry.

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