Th sec is fine with a futures based etf but for some reason doesn’t want a Spot etf.
Which is strange because Canada has multiple spot etfs.
Some arguments for not allowing a spot wtf is that the futures markets are regulated and smaller currently so a futures based wtf can’t grow as big as a spot one at the moment.
Those aren’t great reasons because a lot of spot markets are now hosted by regulated companies like coin and gemini and the he sec said that futures based etfs can hold some of the Canadian spot etfs f they can’t get enough futures contracts
Greyscale wins here by losing as it means they continue to get 2% a year in assets where as a spot etf would charge under 1%.
The Discount to NAV trade continues on, with a 30% discount waiting to be unlocked.
Funny story about this fund and its NAV. It helped sink the fund 3AC.
In 2019 and 2020 it was a very crowded trade to give them BTC and get units back that were locked up for 6 months. The units at the time traded at a premium to its NAV( ie you gave 1,000,000 in BTC and got back units worth 1,200,000).
Now the NAV has inverted such that the cost per share is less than the btc it holds due to funds like 3AC trying to get their money out. Lots of funds have lost alot of money trading this fund around, and if it was allowed to convert to an ETF none of those losses would have happened, and yet
the SEC wont' allow them to convert for some reason :(
Th sec is fine with a futures based etf but for some reason doesn’t want a Spot etf.
Which is strange because Canada has multiple spot etfs.
Some arguments for not allowing a spot wtf is that the futures markets are regulated and smaller currently so a futures based wtf can’t grow as big as a spot one at the moment.
Those aren’t great reasons because a lot of spot markets are now hosted by regulated companies like coin and gemini and the he sec said that futures based etfs can hold some of the Canadian spot etfs f they can’t get enough futures contracts
Greyscale wins here by losing as it means they continue to get 2% a year in assets where as a spot etf would charge under 1%.
The Discount to NAV trade continues on, with a 30% discount waiting to be unlocked.
Funny story about this fund and its NAV. It helped sink the fund 3AC.
In 2019 and 2020 it was a very crowded trade to give them BTC and get units back that were locked up for 6 months. The units at the time traded at a premium to its NAV( ie you gave 1,000,000 in BTC and got back units worth 1,200,000).
Now the NAV has inverted such that the cost per share is less than the btc it holds due to funds like 3AC trying to get their money out. Lots of funds have lost alot of money trading this fund around, and if it was allowed to convert to an ETF none of those losses would have happened, and yet the SEC wont' allow them to convert for some reason :(