Given that every proposal for a bitcoin ETF has been delayed by the Securities and Exchange Commission (SEC), VanEck and SolidX are allegedly selling a limited version of a bitcoin exchange-traded funds.
According to the VanEck & SolidX Bitcoin Trust 144A Shares proposal, institutional buyers who are qualified will be able to buy publicly quoted DTC-eligible bitcoin security through a brokerage account, similar to existing products like the bitcoin investment trust.
Like most regulated investment vehicles, The VanEck Bitcoin Trust will provide insurance and security services for institutions. These services could be seen as an alternative to ETF’s.
“The Trust will be insured against loss or theft of bitcoin held by the Trust. The insurance will cover loss of bitcoin by, among other things, theft, destruction, bitcoin in transit, computer fraud (i.e., hacking attack), and other loss of numerical codes, known as ‘private keys’, which are necessary to access the bitcoin held by the Trust.”
On 23rd September, Bakkt is set to launch and some investors believe that the culmination of fundamental factors like an increasing hash rate, high profile launches of trading venues and an imminent block reward halving could push the flagship currency to a new yearly high.
The popular American lawyer, Jake Chervinsky has said that the VanEck “limited ETF” can’t be looked at as a full ETF and is instead just an alternative to existing investment vehicles.
“This is misleading. The VanEck SolidX Bitcoin Trust is not an ETF. It looks exactly like the Grayscale Bitcoin Trust, which was launched almost six years ago. Calling this a ‘limited ETF’ is a cute marketing strategy, but that's about it. Calling it a full ETF is just wrong.”
It will be interesting to see how this situation plays out. For more news on this and other crypto updates, keep it with CryptoDaily!