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VanEck And ProShares Withdraw Plans to List Ethereum ETFs

The emerging report shows that VanEck global investment manager and ProShares investment firm, have withdrawn their applications with the US Securities and Exchange Commission (SEC) for their proposed Ethereum Exchange-Traded Funds (ETFs).

Both investment firms filed separate proposals for Ethereum futures ETFs to the market regulator on Wednesday, August 18.

However, both VanEck and ProShares sent separate letters to the SEC on Friday, August 20, asking for the VanEck Ethereum Strategy ETF and the ProShares Ether Strategy ETF to be withdrawn, respectively. As a result, the moves dampen hopes that a crypto ETF might be approved in the US this year.

On August 3, US SEC chairman Gary Gensler hinted that he would be more open to ETFs linked to Bitcoin futures, like those on the Chicago Mercantile Exchange, not physical Bitcoin.

Gensler’s comment led to a flood of filings for Bitcoin futures ETFs. For instance, on August 10, VanEck filed with the SEC for a Bitcoin strategy futures ETF. Last week on August 17, Galaxy Digital, financial services firm led by crypto bull Michael Novogratz also filed with the SEC for a Bitcoin futures ETF.

VanEck followed its Bitcoin futures ETFs application with the Ethereum futures ETF proposal on Wednesday, August 18. ProShares also submitted its application for EFT with exposure to Ether on the same day.

However, on Friday, August 20, legal representatives of both VanEck and ProShares stated that the fund managers have decided not to proceed with registering their respective Ether-based exchange-traded funds.

It is unclear why both investment firms decided to apply for and withdrew similar applications for the Ether ETFs on the same day.

Crypto ETF Approvals Delay

The news regarding VanEck and ProShares withdrawing their applications may disappoint those in the investment community eager to see the first-ever crypto ETF in the US.

The withdrawals are also disappointing to offer exchange-traded fund products that track widely popular cryptocurrencies like Bitcoin and Ethereum.

Currently, CME is the major place that trades futures for cryptocurrencies on the open market. Industry watchers had stated that the futures trading would provide the key impetus for regulators to approve Bitcoin ETFs, as it would set a concrete price level for valuing the funds.

But that has not been the case, as regulators continue to delay approvals for Bitcoin ETF plans.

The proposed ETF funds would have allowed investors to bet both for and against Ether and Bitcoin. ETFs trade like stocks and would give retailer investors another avenue to get in on the rising cryptocurrency trade, in which Bitcoin and Ethereum prices have exploded more than 1000% over the past year.

The First Bitcoin Futures ETF Approved In U.S., Expecting to Start Trading This Week

ProShares’ Bitcoin futures ETF will start trading next week, that is according to an amended filing from ProShares (a U.S. provider of specialized exchange-traded products like leveraged, inverse and volatility exchange-traded instruments) indicated on late Friday, October 15.

The announcement makes a milestone achievement to the cryptocurrency industry in the U.S. The U.S. Securities and Exchange Commission (SEC) has approved the first Bitcoin futures ETF in the sector on Friday afternoon, October 15, after five commissioners working for the agency met to examine the matter.

ProShares, which filed its application in August, is set to launch its Bitcoin Strategy ETF next week. The firm filed its post-effective amended prospectus on Friday, October 15, saying that Bitcoin futures EFT will be allowed to start trading next week, which is today, Monday, October 18. However, the fund may not begin trading immediately.

ProShares’ Bitcoin strategy ETF shares would be listed on the New York Stock Exchange’s Arca. Late Friday afternoon, NYSE Arca certified its approval for the listing, meaning that ProShares asset management firm would allow investors to trade the funds as allowed under federal law without SEC intervention.

The ProShares Bitcoin strategy ETF, which will expose Bitcoin futures contracts, will trade under the ticket “BITO.”

According to the new filing, today, Monday, is the proposed date for the listing, though that does not necessarily imply that when it will start trading, that could come late in the week.

The Approval Boosted Bitcoin Prices

Crypto advocates believe that ProShares’ Bitcoin futures ETF will be more broadly accessible for individuals interested in Bitcoin than the actual cryptocurrency by giving investors a regulated alternative to the underlying digital asset. The first product will track Bitcoin futures rather than the price of Bitcoin directly.

The ProShares’ announcement indicates that the SEC is likely to approve further listings of Bitcoin futures ETFs at this point round. Crypto advocates have been pushing the regulator for several years to approve an ETF related to Bitcoin. The latest arrival is expected by many to bring in a new class of investors into the digital currencies.

The anticipation of the ETF’s listing seemed to have boosted Bitcoin price over the previous week. The crypto-token surged more than 10% over the last week and was trading above $61,000 on Friday afternoon.

Several firms such as Valkyrie, Invesco, VanEck, and Galaxy Digital, which have applied to launch such similar ETFs, could follow ProShares into the market in the coming weeks.

SEC chairman Gary Gensler recently signalled that he believes futures-based products might offer more robust investor protection because of the laws under which they operate.

ProShares Confirms to Start Trading Bitcoin Futures ETF on NYSE Tuesday

American Exchange Traded Funds (ETFs) provider, ProShares, has confirmed Monday that its Bitcoin Futures backed ETF product will begin trading on the New York Stock Exchange (NYSE) under the ticker symbol ‘BITO’ Tuesday.

As contained in the announcement, the ETF product will track Bitcoin Futures and not the digital currency. “We believe a multitude of investors have been eagerly awaiting the launch of a bitcoin-linked ETF after years of efforts to launch one,” said ProShares CEO Michael L. Sapir.

“BITO will open up exposure to bitcoin to a large segment of investors who have a brokerage account and are comfortable buying stocks and ETFs, but do not desire to go through the hassle and learning curve of establishing another account with a cryptocurrency provider and creating a bitcoin wallet or are concerned that these providers may be unregulated and subject to security risks.”

The approval of the ProShares Bitcoin ETF product, as reported last week, marked a major milestone for the digital currency industry and ETF products as a whole. ProShares Bitcoin ETF comes off as the very first of its kind in the U.S after multiple rejections by the U.S. Securities and Exchange Commission (SEC).

According to ProShares, the Bitcoin Futures ETF product will offer investors the long-sought opportunity to gain exposure to bitcoin returns transparently and conveniently through a brokerage account. BITO can be bought and sold like a stock, terminate an account at a cryptocurrency exchange and for a crypto wallet, as well as all of the hassles that come with actively investing in Bitcoin.

The anticipation for the launch of BITO has fueled a week-long growth in the price of Bitcoin. The premier cryptocurrency is trading at a price of $61,329.13 at the time of writing, according to data from CoinMarketCap, and has printed a 7.42% growth in the past week. With the launch today, an additional upsurge in the price of BTC will not come as unexpected.

The launch is also expected to encourage the approval of similar applications for a Bitcoin ETF product, marking a new era that will see increased institutional money flowing into the digital asset class.

ProShares Bitcoin Futures ETF Wants Exemptions from Trading Limits

Less than a week after ProShares (a U.S. provider of specialized exchange-traded products like leveraged, inverse and volatility exchange-traded instruments) launched its futures Bitcoin ETF. It wants to change the way the new product operates.

Michael Sapri, the CEO of ProShares, recently had an interview with Barron’s media and stated that that the company has filed with the U.S. Securities and Exchange Commission (SEC) to request for an exemption from trading limits at the Chicago Mercantile Exchange (CME), where it purchases futures contracts from its Bitcoin ETF and further said that ProShares will request permission from the regulator to invest in other types of derivatives contracts.

Such a consideration has come after the explosive entry of the ProShares Bitcoin Strategy ETF (BITO) put the product at risk of hitting the CME’s limit for the number of Bitcoin futures contracts it is allowed to hold.

Just after two days of its launch, ProShares Bitcoin futures ETF hit $1.1 billion in assets under management. BITO hit 1,900 contracts sold in October, near the CME’s 2,000 front-month (position limit) cap by the end of its second day.

Since issuers can also allocate towards contracts for the following month, by the end of trading on Thursday last week, ProShares Bitcoin ETF already had 1,400 contracts for November. However, there is CME’s overall maximum limit of 5,000 open contracts for all months combined.

One possible solution is to provide longer contracts, but that would carry the danger of too much distancing from Bitcoin prices. The other solution is for the ETF to start diverging from market prices.

Therefore, ProShares has filed with the SEC to be exempted from CME’s position limits and allowed to use swaps if there is a need. Both ways can significantly help the company to maintain exposures if the BITO shares continue getting bigger.

Sapri told Barron’s media that ProShares is planning to invest in other things besides treasury securities and the repo market, stating that it could invest in later-dated contracts, swaps, or structured notes.

ProShares talked about this in detail in a prospectus on Tuesday last week during the launch. The ETF “may, after consultation with the Staff of the SEC,” invest in other products that correlate with Bitcoin price and other cryptocurrencies.

ProShares also said it could invest in stocks that correlate with the cryptocurrency market, such as Bitcoin Miner Riot (a publicly-traded Bitcoin mining company) or MicroStrategy (a publicly traded business intelligence company that holds Bitcoin as part of its balance sheet).

Inflows into ProShares Bitcoin ETF slowed to $100 million on Thursday as ProShares raised its creation fees from one basis point to 10. However, the arrival of Valkyries’ Bitcoin futures ETF on Friday has prompted ProShares to revert back to the original fee level. The appearance of Valkyrie Bitcoin futures ETF and VanEck Bitcoin futures ETF’s anticipated arrival could hopefully alleviate some of the pressures on BITO.

Direxion Files for Bitcoin ETF With a Deviation, to Track Shorts on BTC Futures

American financial services and ETF provider Direxion has filed for its Bitcoin ETF product after more than three years since it last filed one.

Per the company’s filing with the US SEC, the Direxion product, dubbed Direxion Bitcoin Strategy Bear ETF, takes a bit of deviation when compared with other filings in that it will maintain short exposure to bitcoin futures contracts issued by the Chicago Mercantile Exchange.

“The fund will generally maintain its short exposure to bitcoin futures during periods in which the value of bitcoin is flat or declining as well as during periods in which the value of bitcoin is rising,” the filing said.

Direxion said it would not invest the coin directly in Bitcoin; instead, it will inject its capital into other Bitcoin futures ETFs, as well as other financial instruments that can help in capital appreciation. Drawing on the unusual nature of its short position on the ETF, the outfit warns that its product has no guarantee of yielding the desired results, and is thus unsuitable for investors who are not ready to lose money.

“There is no assurance that the Fund will achieve its investment objective and investment in the Fund could lose money. No single Fund is a complete investment program,” the filing reads.

The advent of the ProShares Bitcoin Futures ETF last week has energized investment managers across the board, and many are becoming creative with their ETF applications. While an actual Bitcoin ETF is still out of reach of investors as the SEC is unconvinced that the market is mature enough and rid of price manipulation.

Nonetheless, investors now have an array of ways to gain exposure to the premier digital currency. These ways include but are not limited to spot market purchases, Bitcoin Futures ETF, and buying the shares of Bitcoin-focused public companies like Coinbase Global Inc.

ProShares Files for New Metaverse ETF With U.S. SEC

The metaverse is likely going to see an exchange-traded fund from ProShares, according to a Tuesday filing with the U.S. Securities and Exchange Commission (SEC), Bloomberg reported.

The ProShares Metaverse Theme ETF will be tracking the performance of the Solactive Metaverse Theme Index after approval from the U.S. SEC.

The proposed ETF include Apple Inc, Meta Platforms Inc, and Nvidia Corp. weighting the majority of the index percentage as it focuses on companies that provide or use technologies that offer products and services around the metaverse.

As of Dec 28 global metaverse ETF assets have surged to $2.2 billion and ProShares is among other firms that are seeking to capitalize on the emerging metaverse trend, Bloomberg reported.

“I don’t know if the metaverse theme has legs, but investors believe in it. Given the success of the ETF META, we are likely to see more products come to market that offer a unique twist on this long-term theme,” said Todd Rosenbluth, director of mutual fund and ETF research at CFRA.

According to a Bloomberg report, since its June 30 launch, the Roundhill Ball Metaverse (ticker META) has swelled to $916 million assets under management and in November, Canada saw two metaverse ETFs launched in one day.

ProShares became the first firm to win approval from the U.S. SEC to launch a Bitcoin futures ETF in October and the fund debuted as the second-most heavily traded ETF on record.

Would the U.S. Finally Approve Spot Bitcoin ETF in 2022?

It is a new year and a time investors are positioning their minds toward new possibilities. Trading in 2021 had experienced its ups and downs in all aspects of the cryptocurrency ecosystem, but historical records were also set.

For instance, Bitcoin printed several all-time highs (ATHs), the latest price level above the $68,000 traced back in November.

Some of the ‘Firsts’ in the Crypto Ecosystem in 2021

The digital currency ecosystem recorded a few events that happened for the very first time in 2021. Tesla’s Chief Executive Officer, Elon Musk came out more openly to back Bitcoin in the first quarter, leading his firm to buy up $1.5 billion worth of the premier coin back in February last year. While this was not the first bullish gesture from an institutional investor, it marked the first from one of the most prestigious auto brands in the world.

Also in 2021, Bitcoin became the official legal tender of the Central American nation, El Salvador. After facing a number of criticisms from the World Bank and the International Monetary Fund (IMF), El Salvador floated its Bitcoin law on September 7 with assistance from the Central American Bank for Economic Integration (CABEI).

Counting the number of firsts, Chinese authorities stood their ground on the crypto ban in the country and significantly caused a shift in the mining hashrate to sway from China. Regulations in the United States were a matter of mild concern, but mostly on the productive side as the SEC approved the trading of ProShares Bitcoin Futures-based Exchange Traded Fund (ETF).

Hopes for a Spot Bitcoin ETF this Year

America is becoming more aware of the benefits and impacts of digital currencies, and the SEC is not oblivious to this fact. While the market watchdog had done the best it could do in the past year to approve ProShares Futures ETF, the gesture has sent more fund managers to keep hopes alive that at least one of the tens of Bitcoin spot ETF applications filed with the SEC will gain approval this year.

From Fidelity to Grayscale to Bitwise amongst others, the race to float an actual Bitcoin ETF is just heating up and expectations from the investing community remain high as the year resumes the first trading week in a few hours.

ProShares To Debut First US ETF Betting on Bitcoin Plunge

ProShares, an issuer of exchange-traded funds, including inverse exchange-traded funds, and similar products, announced on Monday that it plans to launch the first short Bitcoin exchange-traded fund (ETF) this week.

The ProShares Short Bitcoin Strategy will trade on the New York Stock Exchange under the ticker BITI, ProShares said. BITI will be the first ETF of its nature in the U.S.

The short Bitcoin-linked ETF aims to give investors the opportunity to profit from a decline in Bitcoin’s price, or to hedge their exposure to cryptocurrency. It will have an expense ratio of 0.95%.

ProShares said BITI is designed to deliver the opposite of the performance of the S&P CME Bitcoin Futures Index and that it seeks to get exposure through Bitcoin futures contracts.

In a statement, ProShares CEO Michael Sapir, said: “As recent times have shown, Bitcoin can drop in value. BITI affords investors who believe that the price of bitcoin will drop with an opportunity to potentially profit or to hedge their cryptocurrency holdings. BITI enables investors to conveniently obtain short exposure to bitcoin through buying an ETF in a traditional brokerage account.”

Investors Wary as Market Sell-Off Continues

While US regulators hold off approving any ETFs that directly track cryptocurrency, ProShares is launching a fund (ticker BITI) that will allow investors to take short positions on Bitcoin futures. In October last year, ProShares established the first U.S. Bitcoin futures ETF.

The latest launch comes as applications for a physical Bitcoin ETF pile up in the U.S., with at least fifteen firms throwing their hat in the ring, including Galaxy Digital Holdings Ltd, Fidelity Investments Inc., and others. Since 2013, the US SEC has rejected every spot Bitcoin ETF application, citing concerns about criminal activity and market manipulation.

The launch is well-timed when the market uncertainty remains high as investors await to hear the next moves by the Federal Reserve with regard to interest rate increases aimed to tame rising inflation. Many investors are still speculating the crypto market to remain bottom due to aggressive actions by the Central Bank.

As the crypto plunge continues, Bitcoin currently trades at the $20,000 level while Ether holds above $1,000, with other major coins such as Solana, Cardano, and Dogecoin all in the red. A spate of cryptocurrency meltdowns has erased tens of billions of dollars of investors’ assets.

Franklin Templeton Floats Metaverse ETF for EU Investors

American multinational holding company and global investment firm Franklin Templeton has launched a metaverse-focused Exchange-Traded Product (ETP).

The ETP dubbed the Franklin Metaverse UCITS ETF will track the Solactive Global Metaverse Innovation Index GTR as it will seek to offer investors exposure to the burgeoning metaverse world.

Through the UCITS ETF, European investors will be able to gain exposure to companies with a vested interest in the metaverse world, or those planning to be involved. The new investment product is on track to be listed on the Deutsche Börse Xetra (XETRA) on September 7, and the Borsa Italiana and London Stock Exchange (LSE) on September 9, respectively.

The new fund will be headed and managed by the duo of Dina Ting, Head of Global Index Portfolio Management, and Lorenzo Crosato, ETF Portfolio Manager at Franklin Templeton.

“Society has already experienced three foundational changes in the way that technology operates and how it’s been delivered since the early 1970s. This exciting fourth wave is now emerging, enabled by blockchain technology,” Dina Ting said in a statement.

“Many big tech companies have already pivoted towards the metaverse for their next major area of development in the same way that many did at the inception of the internet. There appear to be tremendous real-world business opportunities for investment in this space considering that by 2030, the e-commerce market could grow between USD2.0–USD2.6 trillion.”

The Franklin Templeton metaverse ETP did not draft in companies that do not align themselves with the UN Global Compact Principles.

The company comes off as one of the major investment powerhouses that have offered investors an avenue to gain exposure to the metaverse world. Besides Franklin Templeton, ProShares, Fidelity Investments, Global X, ETC Europe, and Invesco are amongst the firms that have floated their own metaverse-linked ETPs in the past year.

ProShares to Launch First Ether ETF and Blended Crypto Funds

Bethesda, Maryland-based ProShares, a prominent player in the crypto-linked ETF market, has announced a significant expansion of its product line. On October 2, 2023, the firm will launch three new exchange-traded funds (ETFs), including the ProShares Ether Strategy ETF (EETH). This will be the first ETF specifically designed to track the performance of ether, the second-largest cryptocurrency by market capitalization. In addition to EETH, ProShares is introducing two blended ETFs that aim to offer investors exposure to both bitcoin and ether, the dominant cryptocurrencies in the market.

ProShares has been a pioneer in the ETF industry since its inception in 2006. With over $60 billion in managed assets, the firm has been a leader in various investment strategies, including crypto, dividend growth, and geared (leveraged and inverse) ETFs.

The launch of these ETFs is a significant milestone in the maturation of the cryptocurrency market. It follows ProShares’ earlier successes, including the launch of BITO in 2021 and BITI, the first U.S. short bitcoin-linked ETF, in 2022. These new ETFs are expected to further legitimize cryptocurrency investments and could potentially attract a new wave of institutional investors.

Michael L. Sapir, CEO of ProShares, highlighted the growing demand for crypto-linked ETFs, citing the success of their bitcoin-linked ETF, BITO. Launched nearly two years ago, BITO has amassed more than $2 billion in net inflows and has become the largest crypto-linked ETF globally. “The launch of EETH is a response to substantial investor demand for a regulated financial product that targets ether,” said Sapir.

ProShares is also diversifying its offerings with the Bitcoin & Ether Equal Weight Strategy ETF (BETE) and the Bitcoin & Ether Market Cap Weight Strategy ETF (BETH). BETE will undergo monthly rebalancing to maintain a 50/50 weighting between bitcoin and ether. In contrast, BETH will adjust its holdings based on the market capitalization of the two cryptocurrencies. “These groundbreaking ETFs offer investors the opportunity to target the performance of the two leading cryptocurrencies through a single transaction and a single ticker,” Sapir elaborated.

One of the key advantages of these new ETFs is their accessibility through traditional brokerage accounts. This eliminates the need for investors to set up a separate crypto custodian, exchange account, or wallet. “Our crypto-linked ETFs are designed to attract investors who are interested in cryptocurrencies but are concerned about the risks associated with custody or the complexities of direct purchases,” Sapir noted.

Unlike many other investment vehicles, these ETFs do not invest directly in cryptocurrencies. Instead, they primarily invest in ether and bitcoin futures. According to ProShares’ research, these futures have historically shown a .99 correlation with their respective cryptocurrencies, offering a near-perfect tracking of the underlying assets.