• With the filing of a futures product, Bitwise joins the race for Bitcoin ETF approval

  • ETF Series Solutions, a division of the asset management firm, has filed for a bitcoin futures exchange-traded fund (ETF).

    The Bitwise Bitcoin Strategy ETF, which seeks to invest in bitcoin futures and other financial products, was filed under the Investment Company Act of 1940 on Tuesday.

    Proponents of a bitcoin ETF claim that it would provide retail investors with a regulated financial product that includes exposure to bitcoin, providing these investors with an alternative to directly investing in bitcoin. The Securities and Exchange Commission (SEC), the federal agency in charge of approving such products, has yet to do so.

    “The Fund will not invest directly in bitcoin,” according to the filing. “While the Fund intends to gain exposure to bitcoin primarily through indirect investments in standardized, cash-settled bitcoin futures contracts traded on commodity exchanges registered with the CFTC (‘Bitcoin Futures,’ it may also invest in pooled investment vehicles and Canadian-listed funds that provide bitcoin exposure.”

    According to the filing, the ETF may also invest in cash, US government securities, or money market funds. The transfer agent and administrator will be U.S. Bancorp Fund Services, while the custodian will be U.S. Bank.

    SEC Chair Gary Gensler has stated that a bitcoin futures ETF is more likely to be approved than a spot bitcoin ETF. Rather than investing in bitcoin directly, a futures ETF will invest in a regulated bitcoin futures product offered by CME.

    Gensler has expressed concerns about crypto spot market regulation, echoing an opinion expressed by SEC staff in rejecting previous bitcoin ETF applications.

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