By providing exposure to Ether futures through its current Bitcoin Strategy exchange-traded fund (ETF), asset management company Valkyrie is making ripples in the cryptocurrency trading market. This tactical move attempts to give investors the ease of using a single investment vehicle to acquire futures for both Ether (ETH) and Bitcoin (BTC).
As a leader in this field, Valkyrie joins a large group of companies awaiting regulatory approval from the SEC (Securities and Exchange Commission) of the United States for comparable offerings. This article explores the specifics of Valkyrie’s historic choice and its ramifications for the developing crypto ETF market.
The Valkyrie Bitcoin and Ether Strategy ETF
Valkyrie’s Bitcoin Strategy ETF, established to offer investors exposure to Bitcoin, is set to undergo a significant transformation. Starting from October 3, 2023, the fund will be rebranded as the “Valkyrie Bitcoin and Ether Strategy ETF.” This strategic update underscores the asset management firm’s commitment to providing investors with diversified cryptocurrency exposure.
This move makes Valkyrie one of the first firms to offer such a comprehensive ETF, which combines both Bitcoin and Ether futures within a single investment wrapper. It comes as a noteworthy development, given the growing interest in cryptocurrencies beyond Bitcoin, with Ethereum’s Ether being a prominent choice for investors.
Valkyrie initiated this endeavor by filing an application with the SEC on August 16, 2023. The application sought approval for a fund that offers exposure to Ether futures contracts rather than direct investment in Ether itself. While the SEC had not published a proposed rule change for a new Ether futures ETF on the Nasdaq Stock Exchange at the time of publication, it did issue an order related to the listing of the Valkyrie Bitcoin Fund, a spot BTC ETF.
Valkyrie’s proactive approach to the ETF space is not new. The firm previously introduced a Bitcoin Miners ETF, which tracks securities of companies deriving revenue or profits from cryptocurrency mining. Moreover, it was among the pioneering companies in the U.S. to launch an ETF tied to Bitcoin futures back in 2021. This extensive experience in the crypto ETF realm positions Valkyrie as a formidable player in the rapidly evolving landscape.
Timing and Regulatory Implications
Bloomberg Intelligence analyst James Seyffart has speculated that Ether futures ETFs could commence trading during the first week of October. This anticipation is partly fueled by concerns of a potential U.S. government shutdown. If members of Congress fail to pass a funding bill for the government’s next fiscal year before September 30, various federal agencies, including the SEC, may operate with reduced staffing levels.
Notably, the SEC has yet to approve any spot cryptocurrency ETFs for trading in the United States. However, experts have suggested that this stance could shift following Grayscale Investments’ successful review of its spot Bitcoin ETF in appellate court. Valkyrie, alongside other prominent firms like BlackRock, has pending applications for spot crypto ETFs, eagerly awaiting regulatory decisions that could reshape the crypto investment landscape.
In conclusion, Valkyrie’s decision to offer Ether and Bitcoin futures exposure within a single ETF represents a significant milestone in the cryptocurrency investment industry. As regulatory developments continue to unfold, the launch of the Valkyrie Bitcoin and Ether Strategy ETF could mark a turning point in providing investors with more diversified options for navigating the crypto market. The cryptocurrency community will closely monitor the ETF’s reception and its impact on the broader investment landscape.
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