Is a bitcoin exchange-traded fund (ETF) finally coming?
Many investors/speculators hope so, and so does money manager VanEck Associates, which filed with the Securities and Exchange Commission Wednesday to introduce The VanEck Bitcoin Trust.
The SEC has rejected several investment firms’ efforts during the past few years to start a true bitcoin ETF, because it views the vehicle as very speculative. There is the Grayscale Bitcoin Trust (GBTC) , but it trades 24% above its net asset value.
As for the VanEck Trust, its “objective is to reflect the performance of the MVIS CryptoCompare Bitcoin Benchmark Rate less the expenses of the Trust’s operations,” the company said in its filing.
“In seeking to achieve its investment objective, the Trust will hold bitcoin and will value its shares daily based on the reported MVIS CryptoCompare Bitcoin Benchmark Rate,” the company noted.
VanEck has twice before submitted applications to the SEC to register bitcoin ETFs but both times has withdrawn them.
Bitcoin recently traded at 28,426, down 0.58%. It has repeatedly soared to record highs this year, skyrocketing 308% so far.
Bitcoin is known as a digital currency, but it’s barely used as a medium of exchange in legitimate commerce. What it often represents instead is a vehicle for speculation.
Bitcoin advocates say it’s a hedge against inflation and weakness in other assets, such as stocks, bonds and the dollar. But it hasn’t been tested much against any of these conditions since being introduced in 2009. While it’s now ascending in line with a falling dollar, bitcoin’s climb also has come in tandem with soaring stock prices.
Bitcoin bulls like to call it a store of value. But it’s only that inasmuch as investors view it that way.