Bitcoin exchange-traded fund (ETF) is filed by a widely known stock exchange. Of course, This sees the exchange getting in the Bitcoin (BTC) game.
More so, NYSE Arca just files for a physically backed Bitcoin ETF with the U.S. Securities and Exchange Commission (SEC).
Notably, this is Alongside Bitcoin index provider Bitwise. Also, NYSE Arca is seeking for a Bitcoin exchange-traded fund (ETF) with direct exposure to Bitcoin.
Meanwhile, Matt Hougan, Bitwise’s chief intelligence officer explains NYSE Arca’s application will hold actual Bitcoin. Instead of, just Bitcoin futures.
“Today NYSE filed for a Bitwise Bitcoin ETF!”
“It would hold actual BTC, *not* futures.”
“There’s already a separate BTC futures-based Bitwise ETF filing. But actual BTC is better.”
“And we believe it’s finally possible.”
“We’re sharing 100+ pages of analysis on why.”
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Furthermore, Hougan outlines three reasons why holding actual BTC is preferable to futures.
Firstly, this will save the firm roughly 6-12% in costs which is with futures funds.
Secondly, ETFs cannot hold 100% Bitcoin futures. While, Hougan predicts a Bitcoin Futures ETFs will come with about a 15% dilution.
Thirdly, he explains that futures come with tail risk. which of course, exposes investors to their assets’ most extreme decline performance. However, by just holding BTC, such risk will be out of the way.
“In sum: A futures-based Bitcoin ETF comes with ~6-12% all-in costs, ~15% dilution, and tail risk.”
“Useful for certain investors, but not ideal.”
“A direct BTC ETF avoids all that.”
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