- VanEck has submitted an amended application for a spot Bitcoin ETF to the SEC, differentiating itself from other applicants by opting for a Bitcoin-based fund seeding method.
- This move comes after previous rejections from the SEC, placing VanEck in a strategic position within the growing cohort of asset managers revising their spot Bitcoin ETF applications in response to regulatory concerns.
VanEck’s Strategic Pivot in the ETF Arena
In the intricate landscape of digital asset management, New York-based VanEck has made a noteworthy move by submitting an amended application for a spot Bitcoin ETF to the U.S. Securities and Exchange Commission (SEC). This filing, dated October 27, reveals a departure from conventional strategies employed by other applicants in the spot Bitcoin ETF domain.
Andddddd @vaneck_us joins the amendment filings for spot #bitcoin ETF issuers. h/t @NateGeraci pic.twitter.com/zdYuUTAaE6
— James Seyffart (@JSeyff) October 29, 2023
VanEck’s approach stands out due to its unique choice of utilizing Bitcoin itself for fund seeding, deviating from the more common cash-based seeding method seen in other spot Bitcoin ETF proposals. This innovation in their application process distinguishes VanEck in a competitive field, setting a precedent for potential progress in the ongoing dialogue between asset managers and regulatory bodies.
A Glimpse into VanEck’s Amended Filing
The SEC had previously rejected VanEck’s application to list and trade shares of the VanEck Bitcoin Trust on three separate occasions, with the latest rejection occurring on March 10. These rejections reflect the SEC’s broader trend of caution towards ETFs that track digital assets, citing concerns over potential market manipulation in the underlying digital asset markets.
Scott Johnsson, a finance lawyer, highlighted the significance of VanEck’s new filing. He noted that the firm’s Bitcoin ETF is set to use Bitcoin directly for fund seeding, marking a departure from previous cash-based methods. The VanEck Bitcoin Trust aims to track the performance of Bitcoin, net of operational expenses, by maintaining Bitcoin holdings instead of cash.
Share transactions of the trust will occur in blocks of 50,000, termed as a
“Creation Basket,”
with the value of the basket determined by the amount of Bitcoin it represents. In instances involving a cash subscription, the required amount will be calculated based on the cash needed to purchase the corresponding amount of Bitcoin, as determined by the administrator.
VanEck: A Contender in the Spot Bitcoin ETF Race
VanEck’s amended filing places them in the ranks of asset managers seeking approval for a spot Bitcoin ETF, joining the likes of Bitwise Asset Management, ARK Invest, and 21Shares. All of these firms have recently submitted revised applications, indicating a trend of refined strategies in response to regulatory feedback.
While the SEC has delayed decisions on various spot Bitcoin ETF proposals, the market awaits potential resolutions in the coming weeks. Parallel to their efforts in the spot Bitcoin ETF domain, VanEck is also advancing in the cryptocurrency space with plans to launch Ethereum-styled futures contracts pending SEC approval, showcasing their dual approach in embracing digital asset innovation.
