Bit by bit bullish on its bitcoin spot ETF after abandoning the futures ETF application

Bitwise Asset Management has withdrawn its application for an exchange traded fund (ETF) based on Bitcoin (BTC) futures due to several launches of these products in the US.

Although the company is ditching its futures-linked ETF, the company is still relying on a Bitcoin ETF designed to track Bitcoin directly.Bitwise Chief Investment Officer Matt Hougan announced on Wednesday.

Hougan said Bitwise’s filing remains intact and that the company will continue efforts to bring such a product to market in the United States:

Ultimately, many investors want a spot Bitcoin ETF. We believe this is possible. Hence, Bitwise will continue to pursue this goal and we will look for other ways to help investors gain access to the incredible opportunities in crypto.

Bit by bit bullish on its bitcoin spot ETF after abandoning the futures ETF application
Bit by bit bullish on its bitcoin spot ETF after abandoning the futures ETF application

Hougan emphasized that the first Bitcoin ETF application submitted was a spot ETF from crypto exchange Gemini founders Cameron and Tyler Winklevoss. The application, filed in 2013, was denied by the US Securities and Exchange Commission in 2017. “Many have worked on it for years, including this team”, called.

Hougan went on to say that “every ETF is a big step”, based on several Bitcoin futures ETFs that receive SEC approval and begin trading in October. However, there are several reasons Bitwise withdrew its own application.

The executive cited the Bitwise analysis that suggests than the contango bitcoin futures ETF, a situation where the futures price is higher than the spot, it would cost investors between 5 and 10% per year.

Hougan too he showed which supposedly BTC futures ETFs have absorbed “all available capacity from futures commission dealers”. “This will wear off over time, but one more issue is being added for now. The result? Cost over cost, more added complexity, ”he said.

He stressed that “none of this means that futures-based ETFs are bad”., adding that products like the ProShares Bitcoin Strategy ETF and the Valkyrie Bitcoin Strategy ETF are “thoughtful versions”.

As previously reported by Cointelegraph, Bitwise applied for a spot Bitcoin ETF in mid-Octoberwith the intention of listing the product on the NYSE Arca electronic exchange. The request came just a month after the company applied for the Bitwise Bitcoin Strategy ETF in September.

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