U.S. financial regulators will eventually give the green light to a bitcoin-ETF, but approvals are unlikely before 2023. In an interview with ETF.com, Will Cai, co-founder of New York-based Wilshire Phoenix, said this.
Are #bitcoin and #gold competitors? We don\’t think so. Find out why in the latest from @ETFcom where WP Partner Will Cai sits down with @sumitroy2 in a jampacked discussion you won\’t want to miss.
Read: https://t.co/Wt3kCv7XJ0
— Wilshire Phoenix (@WilshirePhoenix) July 13, 2021
\”Although we believe that a bitcoin ETF will eventually appear in the U.S., it is unlikely to happen this year or next,\” he said.
In February 2020, the U.S. Securities and Exchange Commission (SEC) rejected Wilshire Phoenix\’s bid to launch a Bitcoin-based ETF. The regulator concluded that the firm had failed to demonstrate adequate protections against market manipulation of the underlying asset.
In June of the same year, Wilshire Phoenix filed with the SEC for listing shares of the investment trust wShares Bitcoin Commodity Trust on the OTC Markets Group\’s over-the-counter trading system.
In 2021 the company updated the application. If approved, the structure could compete with Grayscale Investments\’ funds.
\”The wShares Bitcoin Commodity Trust was created to offer a better product than those available on the market. It possesses characteristics that will help temper the huge premiums and discounts that arise in existing products,\” Will Cai said.
According to the head of the company, Bitcoin has much in common with gold, yet in many respects it is fundamentally different from the precious metal. He believes that the first cryptocurrency should be viewed as belonging to an entirely new asset class.
\”Gold and Bitcoin have much in common. They can both serve as stores of value and as mediums of exchange. They are both scarce and must be mined. […] Gold and Bitcoin have low correlations with other asset classes, which helps reduce the risk-return profile of an investment portfolio. […] However they have critical differences that allow them to complement each other. They are only weakly correlated even with each other,\” added Cai.
While American regulators delay the review of applications, several countries have already approved cryptocurrency-based exchange-traded funds. The Brazilian Securities and Exchange Commission allowed B3 to conduct listing of Ethereum-ETF from QR Asset Management.
In February, Canada registered the first ETF based on digital gold.
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