Analyst questions Fidelity and SkyBridge spot Bitcoin ETF filings

Arcane Research analyst Vetle Lunde said that SEC approval of Fidelity Investments’ and SkyBridge Capital’s filings to launch a spot Bitcoin ETF seems unlikely.

BTC ETFs: Fidelity and SkyBridge verdicts coming shortly. Approval seems unlikely, given the prev. rejections.

Still, pay attention to Fidelity. They’ve reportedly arranged private meetings with the SEC, in addition to providing PD analysis on BTC, contrary to most other filings pic.twitter.com/6eMkc2DyY1

— Vetle Lunde (@VetleLunde) January 9, 2022

SkyBridge Capital and First Trust Advisors filed the application to launch a Bitcoin ETF on March 20, 2021, Fidelity Investments — on March 25.

Lunde cited prior refusals by the agency. In particular, on November 12 the SEC rejected the filing from VanEck, on December 1 — from WisdomTree, December 23 — from Valkyrie Investments and Kryptoin Investment Advisors.

The analyst urged focusing on Fidelity’s case. The company has held a series of private meetings with SEC officials arguing in favour of approving the spot ETF.

Arcane Research also noted waning interest in ProShares’ Bitcoin futures-based ETF (BITO), linking this to the costs of rolling the instruments. rolling

For the first time since November, BITO reduced the number of CME contracts held to fewer than 5,000. AUM fell to $1.03 billion. The same figure was seen almost immediately after its debut.

Proshares’ BITO ETF has failed to maintain its momentum, likely due to the costs associated with rolling.

The fund now holds less than 5000 CME contracts for the first time since Nov.

The AUM of BITO is even more disheartening, sitting at $1.03bn, the lowest since Oct 19. pic.twitter.com/p7dKGinUIS

— Vetle Lunde (@VetleLunde) January 9, 2022

According to Lunde, a similar picture also applies to BITO’s peers — Valkyrie Investments’ ETF holds 150 contracts (AUM at its nadir since October 25), and a similar structure from VanEck stands at 79 contracts.

The market has spoken, and it is clearly not in favour of futures-based ETFs, the analyst concluded.

The futures-based ETFs overall fail to gain any traction.

Valkyrie currently holds 150 Jan contracts. Lowest AUM since Oct 25th. Meanwhile, VanEck holds a meager 79 Jan contracts.

The market has spoken, and it’s clearly not in favor of the futures-based ETFs.

— Vetle Lunde (@VetleLunde) January 9, 2022

Earlier, Grayscale Investments suggested that the SEC violated the law in approving futures-based Bitcoin ETFs.

Bitwise Asset Management CIO Matthew Hugan questioned whether such instruments are suitable for long-term investors.

In December the SEC postponed its decision on Grayscale Investments’ and Bitwise Asset Management’s applications to launch a Bitcoin ETF.

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