Invesco Seeks SEC’s Approval for Bitcoin Strategy ETF

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 Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Read this Term ETF in March 2019 on the London Stock Exchange, which tracks the performance of companies involved in blockchain development.

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 Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term, 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.