Despite the US securities market regulator’s hesitation to green light Bitcoin exchange-traded funds (ETFs), more and more companies are applying for it. Most recently, Atlanta-based asset manager Invesco has filed with the Securities and Exchange Commission (SEC) seeking permission to list a Bitcoin ETF.
As per Wednesday’s filing, the company is willing to list a new investment product called the Bitcoin Strategy ETF.
No Direct Exposure to BTC
But, unlike other Bitcoin ETF proposals, Invesco’s instrument will not invest directly into Bitcoin. Instead, the company will invest ‘all or substantially all of its assets’ in Bitcoin futures, exchange-traded products (ETPs), and also other Bitcoin-linked investment vehicles like Grayscale Bitcoin Trust.
Additionally, the prospectus highlighted that the asset manager might allocate its funds in Bitcoin ETFs listed in the markets outside the United States. Interestingly, Invesco already listed a blockchain ETF in March 2019 on the London Stock Exchange, which tracks the performance of companies involved in blockchain development.
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Moreover, the SEC filing detailed that the fund is planning to invest the remaining assets directly in cash and cash-like instruments, along with securities, that will serve the purpose of collateral.
“The collateral is designed to provide liquidity, serve as margin or otherwise collateralize the subsidiary’s investments in Bitcoin futures,” the company stated.
Invesco is one of the many companies seeking SEC’s permission to launch a Bitcoin ETF. The long list of names already submitting their applications includes Fidelity, VanEck, Kryptoin and WisdomTree. In addition, these companies have onboarded Cboe and NYSE Arca as their exchange partners to list the ETF.
Meanwhile, SEC’s new chair, Gary Gensler recently requested the senate to provide the agency with more power to oversee the ‘wild west’ of the crypto industry. However, he did not hint at anything related to the approval of long-pending Bitcoin ETF applications.