Cryptocurrency index fund firm Bitwise Asset Management has sent in an application with the United States Securities and Exchange Commission (SEC) to introduce a new Bitcoin (BTC) Exchange Traded Fund (ETF).
A registration form that was published recently shed light into the matter.
The form indicated that Bitwise’s proposed ETF would track the Bitwise Bitcoin Total Return Index, the value of which is “calculated based on the prices of bitcoin that the Index Provider derives from bitcoin price transactions occurring on cryptocurrency exchanges.”
The press release relayed that the Bitwise’s proposed Bitcoin ETF functions differently from other previously proposed Bitcoin ETFs in that it takes prices from various different crypto exchanges, with the goal of representing the market better.
Bitwise’s Bitcoin ETF also differs in that it would require “regulated third-party custodians to hold its physical bitcoin.”
John Hyland, Global Head of ETFs at Bitwise was quoted as saying in the press release:
“Having a regulated bank or trust company hold physical assets of a fund has been the standard under U.S. fund regulation for the last 80 years, and we believe that is now possible with Bitcoin.”
Bitwise had filed with the SEC to introduce a crypto ETF tracking the Bitwise HOLD 10 Private Index Fund, a basket of ten cryptocurrencies. That particular application has yet to be decided on by the SEC as of this time.
An ETF is a security that tracks an asset or a group of assets and is traded the same way in which stocks are on an exchange. Japan’s Financial Services Agency (FSA) has rebuked reports that it is thinking of allowing Bitcoin exchange-traded funds.
The crypto industry has been waiting for the approval of a Bitcoin or generally crypto ETF by regulators in the United States, since a number of companies have applied to introduce these products. Last month, the SEC deferred its ruling on a Bitcoin ETF by investment company VanEck and blockchain company SolidX on the Chicago Board Options Exchange (CBOE). Its new deadline for the said decision has been set on February 27, 2019.
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