Investment Management Companies VanEck Securities Corp. and SolidX Management plan to allow institutional investors to work with a Bitcoin (BTC) -based exchange-traded fund, reports The Wall Street Journal .
According to the publication, two companies that previously applied for Bitcoin ETF approval to the US Securities and Exchange Commission (SEC) will use an “unusual” way to circumvent existing requirements. To do this, they will turn to the statutory exception, which will allow VanEck SolidX Bitcoin Trust securities to be offered to institutional clients, such as hedge funds and banks, while retail investors will stay away.
WSJ writes that trading in bitcoin ETFs in a limited format can start on Thursday in accordance with SEC 144A, which allows organizing the circulation of securities through closed placement among “qualified institutional buyers” with a shorter shelf life and without the need to obtain regulatory approval.
On August 12, SEC announced the next porting of its Bitcoin-ETF VanEck / SolidX solution. The final deadline for consideration of the application is October 18. To date, the regulator has not approved a single Bitcoin ETF, despite numerous attempts by various industry participants.
VanEck and SolidX hope that by launching ETFs in a limited format, they can convince the regulator to give them permission to run fully.
Commenting on information about the possibility of a limited launch of VanEck / SolidX bitcoin ETFs, lawyer Jake Chervinsky noted that the proposed tool does not meet the definition of ETF as a financial mechanism.
Publication date 09/04/2019
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