08 Apr 2022 Jane Whitmoore
The U.S. SEC Approves Fourth Bitcoin Futures ETF
Despite the recent price slippage, the crypto sector endured, the U.S. SEC approved yet another Bitcoin futures ETF, making it the fourth approval of its kind.
Indeed, the new Teucrium Bitcoin Futures Fund received the SEC’s blessing and Teucrium Trading, a Vermont-based firm, can now add Bitcoin to the list of other approved future funds, like those that track the prices of corn, wheat, soybeans, and sugarcane.
Teucrium traders can now gain exposure to the world’s largest crypto without involving directly in crypto trading. However, the trading world is yet to witness a spot Bitcoin ETF, which tracks the current price of the biggest crypto to date, as futures trading relies on speculation about the future price of the asset.
This is SEC’s fourth Bitcoin futures ETF approval, following Proshares (BITO), Valkyrie (BTF), and VanEck (XBTF), which all went live late in 2021.
Teucrium Trading CEO Sal Gilbertie commented on the approval, adding that the company proposed a rule change in order for the fund to be registered.
“We are pleased that the 19b4 filing was approved, and more information regarding the fund will be forthcoming when the time is appropriate,” Gilberte added.
Time for a shift of stance in the SEC?
Despite the SEC having a strict policy about ETF approval, it registered all of the three prior funds under the Investment Company Act of 1940, which the SEC has said provides strong consumer protections. However, after Teucrium’s filing, the SEC marks the first time the regulator has approved a Bitcoin futures fund under the Securities Act of 1933.
It may not seem like big news, but the crackdown implies that the road in front of approving the first for the first spot Bitcoin ETF may be clearer than before, as funds regulated under the 1940 act provide “important investor protections,”— a set of regulatory policies regarding valuation, liquidity, and custody of the fund’s assets that aren’t covered under the 1933 act.
Both the latest ARK Invest and 21Shares spot Bitcoin ETF proposal, as well as the NYDIG and VanEck spot Bitcoin ETF applications, were filed under the 1933 act and denied, citing concerns about lack of oversight. However, with the latest approval, crypto experts believe that the protections in the 1933 act should be strong enough for a Bitcoin spot ETF as well.
Meanwhile, Grayscale CEO Michael Sonnenshein elaborated on the subject, adding that the regulator “acknowledges this linkage in the Teucrium approval “the Commission is not persuaded that the market for CME bitcoin futures contracts “stands alone;” has a “lack of connection” with, and is “not specifically materially influenced” by, other bitcoin markets”.
“They [The SEC] can no longer justifiably cite the ‘40 Act as being the differentiating factor,” Sonnenshein noted, adding that the largest crypto asset manager to date may file a lawsuit against the SEC in order to convert its Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF.
Crypto prices slip down
The positive news didn’t manage to overcome the 5% weekly price slippage that Bitcoin recorded. The crypto leader found strong support at around $43,000 and currently hovers at around $43,140 per BTC.
Source: Crypto Browser
Ethereum followed Bitcoin’s price movement, but the second-largest crypto to date experienced less of slippage than Bitcoin.
Interestingly, despite the negative price movement, Solana (SOL) went past Ripple in terms of market capitalization to secure the sixth spot in the crypto market cap rankings with a market cap of $37,8 billion.
Meanwhile, one of the greatest gainers happened to be NEAR Protocol (NEAR), which exploded with a 20% price increase on the day and a weekly gain of almost 40%
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