Hashdex Engages SEC in Talks over Its Unique Bitcoin ETF Proposal
Asset manager Hashdex discussed its distinctive Bitcoin ETF proposal with the SEC, focusing on trading spot Bitcoin through the Chicago Mercantile Exchange.
Thu, 26 Oct 2023, 15:01 pm UTC
Recent discussions between asset management firm Hashdex and the United States Securities and Exchange Commission (SEC) shone a light on the former's unique Bitcoin ETF proposal. These talks, held on October 13, revolved around Hashdex's intent to allow their Bitcoin Futures ETF to accommodate spot Bitcoin holdings.
Details released by the Division of Trading Markets highlighted the attendees, which included key representatives from Hashdex, NYSE Arca, Tidal Financial Group, and the renowned law establishment K&L Gates. This assembly provided a platform for Hashdex to elaborate on its distinct approach. They aim to facilitate spot Bitcoin trading within their ETF through the Chicago Mercantile Exchange (CME), a market overseen by the Commodity Futures Trading Commission.
What sets Hashdex's application apart from its counterparts is the absence of a surveillance-sharing agreement with the prominent crypto platform Coinbase. Rather, Hashdex envisions obtaining spot Bitcoin exclusively from physical exchanges within the CME's purview. This means the CME's pricing model would be the sole determinant for their transactions. This strategy was documented by NYSE Arca in an SEC filing late in August.
Interestingly, during the discussions, Hashdex shed light on their operational blueprint grounded on the SEC's Teucrium Order. This order posits that the Bitcoin futures arena is mature enough to accommodate financial tools aiming to engage with Bitcoin.
The ongoing dialogue suggests the SEC might request further details leading up to the initial deadline slated for November 17. Hashdex's current portfolio is noteworthy, with a staggering $380 million in assets and 14 exchange-traded products spread across seven nations.
It's worth noting that Hashdex received the SEC's nod for their Bitcoin Futures ETF back in April 2022. This offering has been a fixture on NYSE Arca since the following September. This ETF will incorporate spot Bitcoin holdings if the regulatory changes gain approval.
Competition in the asset management sector is intense, with numerous contenders vying for the distinction of launching the inaugural spot Bitcoin ETF in the U.S.
BlackRock's ETF proposition debuted on the Depository Trust & Clearing Corporation, fueling speculation of impending approval, as per insights from Bloomberg ETF expert Eric Balchunas. Observers intimate that the SEC might greenlight all spot ETFs within the next quarter.
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