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Regulatory Series on Cryptocurrencies: US SEC Approves NYIG Bitcoin Fund, Can It Be Ray of Hope For Bitcoin ETFs?

The U.S. SEC’s cautionary eye on the crypto regulation has constantly shown its meticulous approach by constantly deferring and denying the approval of applications filed by various renowned crypto-players like VanEck-SolidX, Cameron and Tyler Winklevoss, the reputed cryptocurrency investors and the founders of cryptocurrency exchange Gemini.

But for now, the NYDIG (New York Digital Investment Group) has obtained an approval from the SEC to commence their business in Bitcoin Strategy Fund, which is a portfolio fund in the Stone Ridge Trust Vl.

The NYDIG fund will invest in cash-settled Bitcoin futures contracts traded on Commodity Futures Trading Commission-approved exchanges, like the CME Group, which has its own BTC futures contract. Thereby, that implies the fund won’t have any exposure to the coins on a blockchain when it launches. 

As per the announcement, the fund would be targeting predominantly on Bitcoin futures so that the total value of the Bitcoin underlying the Bitcoin futures held by the Fund is as close to 100% of the net assets of the Fund.

Mr.Matt Hougan, the managing director of Bitwise, has recently reckoned that his company has a competitive edge at striking a chord in Bitcoin ETF history, despite previous SEC rejections.

The ray of hope on SEC-approved ETF still appears to be intact as Bitwise Managing Director Matt Hougan, stated recently at CNBC that his investment firm is “closer than ever” to obtaining approval for his firm’s Bitcoin exchange-traded fund (ETF), he seemed to be quite assertive that it would be “exciting week,” during Bitwise Bitcoin ETF proposal knocked the US-SEC.

Although the US SEC declined the latest proposal from Bitwise, the US security watchdog (SEC) has reconsidered to review its decision about the Bitcoin exchange-traded fund (ETF) filing from Bitwise Asset Management and NYSE Arca.

The SEC has announced that the ETF filing from Bitwise Asset Management and NYSE Arca is reconsidered for review. The U.S. regulators mentioned that the applicants did not meet the necessary requirements, that could be potential market manipulation, custody issues or even illicit activities, due to which the application might have been declined. 

The various U.S-based crypto companies for financial services have been constantly attempting their luck at issuing publicly-traded Bitcoin funds (ETFs). Bitcoin now appears to be among the most efficient institutional markets in the world.

By Niranjan Patil
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