Another ETF based on Bitcoin Futures is about to debut on Nasdaq: it is Valkyrie‘s ETF which is expected to be listed starting today, October 22.
The news was also confirmed by CEO Leah Wald in an interview with CNBC.
The Valkyrie Bitcoin ETF
This new ETF, which will debut on Nasdaq, will have the ticker BTF and hopes to replicate the success of ProShares’ previous ETF (which is listed on the NYSE). The SEC has finally given the green light to this product too, which like that of ProShares, has Bitcoin Futures as its underlying.
On Monday, VanEck’s ETF will also make its market debut.
Bitcoin’s price deflates
Meanwhile, after the boom on October 20 that took Bitcoin to a new all-time high, the price of Bitcoin today seems to be struggling. BTC is back below $64,000 and is now down 4%.
We will have to wait until the US markets open to see if the sales of Valkyrie’s new ETF will also have an impact on Bitcoin’s price.
Competition between ETFs
In the US, until a week ago, there was no ETF on Bitcoin. Within a few days, there was the debut of the ProShares ETF, then the launch of Valkyrie and by Monday VanEck is also expected. This means there will potentially be a lot of competition.
According to the Huobi exchange, this will lead the companies to compete on commission costs, which could make a difference. The lower the fees, the more investors will enter the market, seeking exposure to BTC at a minimal cost.
Many institutional investors will be able to enter a market that now has certain guarantees. In fact, unlike the common purchase of BTC on exchanges, the ETFs approved by the SEC have as their underlying Bitcoin futures, which are listed on the CBOE or the CME, both regulated by the CFTC, which is a guarantee. Huobi explains :
“This also means that institutional investors will face less opposition from their boards and LPs when investing in these futures ETFs. In short, we will see more and more institutional investor interest in cryptocurrencies and cryptocurrency-linked products, which will help drive the market going forward”.
Will a spot ETF on Bitcoin also arrive?
One question remains: will the SEC ever approve an ETF based on Bitcoin and not futures? According to Huobi, the path is set:
“Futures and spot markets are inherently linked with each other, and data from the Proshares futures ETF and other ETFs can provide indications that make it easier for the SEC to approve spot ETFs in the future”.
For Valkyrie CEO Leah Wald, it’s likely that these types of ETFs will be approved in 2022. So we might as well focus on the trend of the moment: ETFs based on Bitcoin futures.