June 27, 2022

SEC Will Reportedly Not Allow Leveraged Bitcoin ETF

2 min read

The US Securities and Exchange Commission (SEC) will not approve leveraged Bitcoin Exchange-Traded Funds (ETF), says a report.

SEC Won’t Approve Leveraged Bitcoin Fund

As per a report from Wall Street Journal, the SEC has informed at least one possession supervisor not to go ahead with plans for a leveraged Bitcoin ETF.

An exchange-traded fund is a financial investment product that tracks the cost of a specific possession. This suggests that investors can invest into the stated asset without in fact owning it.

There are a couple of advantages to investing into an ETF rather of the asset itself. In the case of Bitcoin, financiers who aren’t versed with the crypto world might consider such a fund a much easier method to invest as they no longer require to handle digital currency exchanges and wallets.

Another benefit is the ability to trade both long and short. When you hold BTC, you just revenue when the cost goes up. However trading in ETF makes it possible to earn gains in either instructions.

Earlier this month, the ProShares ETF became the first such Bitcoin fund to launch, and observed record-breaking need. Now asset managers are seeking to open more items including the crypto, and a leveraged ETF is one of the ideas.

Nevertheless, as discussed previously, the SEC has actually currently shot down among the prospectors from continuing ahead with it.

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“Regulators have been curtailing product launches in a bid to restrict financier exposure to offerings that they deem vulnerable to fraud, control and other risks,” checks out the report.

BTC ETFs Note Record-Breaking Numbers In Their First Week

According to the most recent report from Arcane Research, the Bitcoin ETF launch 10 days back was a really effective one and tape-recorded enormous numbers in its very first week.

ProShares’ BITO fund became the fastest ever to break $1 billion in properties. It took 2 days to reach the turning point, while the second fastest launch ever, the SPDR Gold Shares, took three days to accomplish the very same mark.

Related Reading|October Bitcoin Overperformance Reminds Crypto World Why It Remains King

Valkyrie’s BTF also introduced recently and attained around $80 million in trading volume on day one. This made the ETF the 15th most effective launch in history.

Bitcoin ETF Launch

 The effective very first week of the BTC ETF|Source: Arcane Research With the launch of the ETF came a boost for Bitcoin's price that helped the crypto set

a new all-time high simply listed below $ 67k. Here is a chart that demonstrates how the coin has rallied over the past month:

Bitcoin Price Chart

 BTC's rate makes a brand-new ATH|Source: BTCUSD on TradingView
Included image from iStock.com, charts from TradingView.com, Arcane Research