New Crypto ETFs
The past few weeks there have been sudden commotion of S-1 filings for Crypto ETF's here in the USA:
- 21Shares Officially Files For Spot $XRP ETF recall this followed the Canary Capital and Bitwise submissions for XRP ETF too
- Canary Capital officially files for a spot Solana ETF.
- Then Canary Capital officially files for a LTC just a few days after filing for SOL ETF.
- Not a direct filing however, the SEC approved BTC ETF 'Options' allowing it to attract larger investors. This then impacted the SECs decision to allow CBOE and NYSE for spot BTC 'options'.
Why is this important?
Bitcoin ETFs Now Hold Over 1 Million BTC Worth $72.5 $BTC.
Michael Saylor's MicroStrategy #Bitcoin investment is now at a $8,400,000,000 unrealized profit. Some investors are buying MicroStrategy as a way to gain access to the crypto market (know that is via proxy, so not sure I would do that).
New users and investors in Crypto are essential to gain more adoption and grow value and scope. More adoption comes from TradFi such as legacy Pension funds such as an unnamed UK pension fund has invested 3% of its total assets in Bitcoin. Yeah its BTC but, as more options become available they can diversify their holdings too.
Wondering what does PolyMarket think about these new Crypto ETFs?
Crypto ETF Benefits & Limitations
Benefits
Limitations
ETF share price might be lower than crypto token or coin prices
Prices are not directly correlated to the underlying crypto coin or token
CFTC & SEC regulated offerings
As Crypto adoption rises the liquidity pools dry thin out
No need to open Crypto account (avoids AML & KYC)
Provide a limited exposure to small number of crypto coin or tokens
Ability to sell short
Limited ‘Options’ contracts so very thin volume
Provides convenient access like a brokerage account
High management Fee’s. They could be 2% or more in most cases
I am sure there are more these are just the obvious details that came to mind.
Makes me wonder how many other Crypto ETF's would already exist, IF the SEC did not have Gary G. at the helm?
Summary
In the past 18-months or so we have seen the approval and success of the BTC ETF and to a lesser degree the ETH ETF. These correlations have me wondering would be have a tiered ETF environment with BTC and ETF being the top tier ETFs and then sub-tier ETFs covering alt-coins? Like any investment its wise to know what you are getting into and their limitations.
Disclaimer - I am NOT a financial advisor, nor is this advice and no offer is being intended! DYOR
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