It has been a long wait for the cryptocurrency industry in regard to a reliable exchange-traded fund (ETF) for providing investors with greater opportunities for crypto-asset exposure. The good news is that these calls have been answered finally, as a team of finance experts are ready to introduce the world’s first Bitcoin ETF. According to a recent announcement, a regulated fund manager called Hashdex, which is based in Brazil, has signed a deal with a NASDAQ exchange for launching the first crypto asset ETF.
The investment product has been given the title of ‘Hashdex Nasdaq Crypto Index’ and it was approved by the Nasdaw on 18th September. It will be launched on the Bermuda Stock Exchange (BSX). ETFs provide a regulated and insured means for institutional investors for accessing greater levels of crypto exposure without actually having to hold the underlying asset. According to the announcement, the launch will comprise of three million Class E shares that will be listed on the BSX. A Brazilian news source also reported that the ETF would be launched before the end of this year.
The news source highlighted that BSX had been chosen by Hashdex because Bermuda has crypto-friendly regulations. Even though it didn’t provide any more information related to the ETF, Hashdex said that all additional information will be released by Nasdaq, which includes the ETF’s methodology. The information will be made available on the investment page when it is launched. Hashdex’s chief executive, Marceo Sampaio, pointed out that there would be significant improvement in institutional crypto investment with the launch of the ETF.
This prospect of improvement in investments comes amidst reports of expected surges in the demand of these digital assets amongst institutional investors. According to a report, a British crypto-insurance company called Evertas recently did a survey of more than 50 institutional firms from the United Kingdom and the United States. The purpose of the survey was to find out the current state of demand for cryptocurrencies amongst the investors. The company pointed out that 90% of all firms said that they expected to see their crypto exposure increase in the next five years.
When questioned about the reason behind this surge, 76% of the firms responded that they believed there would be an increase in the number of fund managers involved in crypto. 80% also said that there would be a change in investors’ perception relating to these digital assets because of greater liquidity in the market. ETFs can be immensely helpful in such situations. However, most financial markets haven’t been accepting of ETFs. For instance, the Securities and Exchange Commission (SEC) in the United States has been unforgiving where ETFs are concerned.
In the last few years, several firms have submitted proposals for a Bitcoin ETF more than once, which include the Gemini Trust Foundation, VanEck, and Wilshire Phoenix. These proposals have either been rejected by the SEC outright or the companies were frustrated enough to withdraw their applications. But, there seems to be hope, as Raoul Raul, a former fund manager for Goldman Sachs, said that a Bitcoin ETF could be launched in the country soon.