Kryptoin Investment Advisors, the US-based asset manager, has just applied with the United States Securities and Exchange Commission (SEC) to release a Bitcoin (BTC) Exchange Traded Fund (ETF).
Announced last week in a filing document published by the Securities Commission, the Kryptoin Bitcoin ETF Trust is supposed to be traded on the New York Stock Exchange Arca. In fact, the ETF product has been designed to “provide exposure to bitcoin at a price that is reflective of the actual bitcoin market where investors can purchase and sell Bitcoin, less the expenses of the Trust’s operations.”
As per CT:
“The company plans to hold Bitcoin and value the shares of the trust according to the Chicago Mercantile Exchange Bitcoin Reference Rate. The cryptocurrency will be held at an unspecified third-party insured custodian that is also regulated under the Investment Advisers Act of 1940.”
The Exchange Commission filing also goes onto detail that the trust will hodl the flagship cryptocurrency “in seeking to ensure that the price of the Trust’s shares is reflective of the actual bitcoin market.”
Nevertheless, the trust won’t be buying or selling bitcoin directly however, it will acquire it through shares dubbed as baskets. The report goes onto state:
“Instead, when it sells or redeems its Shares, it will do so in ‘in-kind’ transactions in blocks of 100,000 Shares called ‘Baskets’ at the Trust’s net asset value (‘NAV’). Only Authorized Purchasers may purchase or redeem Shares with the Trust, and they will do so by delivering bitcoin to the Trust in exchange for Shares when they purchase Shares.”
It will be interesting to see how this situation plays out. For more news on this and other crypto updates, keep it with CryptoDaily!