Valkyrie Suggests that Firms Holding BTC Launch ETF
Valkyrie Digital Assets, a company that invests mainly in crypto, has applied for ETF with the US Securities and Exchange Commission. The firm, otherwise known as Valkyrie Digital Assets, is planning to buy stocks in firms holding Bitcoin. The firm believes that you needn’t buy Bitcoin so long as it is easier to buy shares of firms holding Bitcoin. In the same vein, you have no business purchasing selective stocks since you can buy an ETF that will buy that on your behalf. That explains the reason Valkyrie is considering its Innovative Balance Sheet ETF.
Valkyrie’s ETF Vs JP Morgan’s Crypto Investment Basket
As you might have known, ETFs refer to investment instruments such as stocks, forex, bonds, cryptocurrencies, commodities, and other investment instruments that investors trade on exchanges similar to how company shares are traded. One of the advantages of ETFs is that investors can trade them any time of the day, hence they are more attractive to investors.
Valkyrie’s ETF’s proposal can be compared to JP Morgan’s crypto investment basket launched by the popular bank two weeks ago. But Valkyrie’s investment instrument will focus on assets of firms that have invested in or transacts in Bitcoin or are operators in the Bitcoin space. But while Valkyrie has not yet disclosed the companies that will be included in its ETF, JP Morgan announced that the biggest Bitcoin holders, including MicroStrategy, Riot, and Square, will take a large share of its ETF.
Valkyrie’s filings to the SEC states that its ETF would spread its investments across companies of different sizes within and outside the US. In addition to investing in stocks, the fund will consider several other securities as mentioned above.
Is there any hope that SEC will approve BTC ETF sooner or later?
Till today, the SEC has never accepted any application filed by companies seeking to launch a Bitcoin ETF. Having being denied the opportunity to launch Bitcoin ETF, some companies have been creating alternative means of granting willing people exposure to Bitcoin and circumventing the SEC restrictions.
There has been a long debate on the SEC’s possibility of approving Bitcoin ETF. Some observers have, however, expressed optimism that SEC will soon start approving the numerous filings to launch Bitcoin ETF in the US. The optimism partly explains the reason for the continuous bullish momentum in the price of the digital asset. According to Mati Greenspan, the SEC rejected the earlier applications because it noted that there are still many issues relating to protecting investors’ funds that have not been addressed on Bitcoin ETF.
The analyst added that SEC was concerned about the crypto market’s volatility, which might lead to loss of investors’ funds. Apart from that, the SEC is still concerned about possible manipulation of ETF prices, judging from the laxity in regulating the crypto industry. Mati, however, expressed hope that the SEC would soon approve some of the applications when some of the concerns raised by the regulatory body have been duly addressed. For example, the SEC disapproved of the first ETF request filed by Winklevoss twins for lack of clarity on Bitcoin.