The constant refusal by the United States Security Exchange Commission (SEC) to give regulatory approval for Bitcoin ETF-like Products has prompted plans for two firms to launch a more limited version later this week.
According to a report on the Wall Street Journal (WSJ) today, investment management firms, VanEck Securities Corp. and SolidX Management are planning to offer a limited version of Bitcoin ETF to few institutional investors by Thursday.
SolidX Management, as stated in the report, will provide financial backing for the trust while VanEck will be in charge of marketing the shares. An addition has been made in the form of BNY Mellon – which is assigned to carry out the function of daily fund accounting, administrator, and transfer agent.
“As the first bitcoin product in the U.S. with standard ETF creation and redemption and established clearing and settlement processes, institutional investors can finally gain exposure to bitcoin within a familiar context,” Daniel H. Gallancy, CEO of SolidX, said in the report.
The firms hope to take advantage of an exemption to the SEC’s rule 144A , which allows the sale of private securities to “qualified institutional buyers,” without the requirement of registration with the regulator.
Per the report, the exemption implies that both VanEck and SolidX can offer shares of their Bitcoin ETF’s trust to selected institutional investors, including banks hedge funds, and brokers, with an exemption to retail investors.
Acquiring these shares would grant investors access to a physically-backed Bitcoin product that can be traded via traditional and prime brokerage, the firms stated in the report.
The Shares are the first institutional-quality, cleared product providing exposure to bitcoin and enabling a standard ETF creation-and-redemption process.
VanEck and SolidX are reportedly hoping that this limited version will help convince the SEC that a Bitcoin ETF can work effectively.
The wait for the approval of Bitcoin ETF-like Products by the SEC continues to linger, as the regulator is yet to give a green light for Bitcoin ETFs in the U.S.
Many firms have had their application for a Bitcoin ETF rejected or delayed by the SEC, including Bitwise Asset Management, Wilshire Phoenix, and VanEck/SolidX.
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