NYSE files for listing Bitcoin ETF and T-Bills

NYSE files for listing Bitcoin ETF and T-Bill-backed fund. The exchange’s application for a Bitcoin-backed ETF was recently delayed by the SEC.

21 May, 2019 | AtoZ Markets – The Chicago-headquartered stock exchange NYSE Arca has filed a proposed rule change with the US Securities and Exchange Commission (SEC) for an application to list shares in a proposed Bitcoin (BTC) investment trust fund that would be backed by the cryptocurrency and T-bills. This latest development was disclosed in an SEC filing published on May 20.

NYSE Arca files proposed rule change with SEC for Bitcoin

As was outlined in the filing, the proposed trust, which will be managed by Wilshire Phoenix Funds, would invest solely in Bitcoin and short-term US Treasury securities with a maturity of less than one year, also known as T-Bills. The Trust’s objective is for the shares “to closely reflect the Bitcoin Treasury Index […] less the Trust’s liabilities and expenses.”

“NYSE Arca, Inc., proposes (1) to amend NYSE Arca Rule 8.201-E (Commodity-Based Trust Shares) to provide for issuance and redemption of such securities for the underlying commodity and/or cash, and (2) to list and trade the shares of the United States Bitcoin and Treasury Investment Trust under NYSE Arca Rule 8.201-E, as proposed to be amended,” the filing stated.

The stock exchange also elaborated that it would appoint Coinbase’s custody arm to provide custodial service for the trust’s crypto investments. A tie with Coinbase will also provide up to $200 million insurance coverage, which the crypto exchange bought to protect the funds stored in its wallets from any attack.

“According to the Registration Statement, the Trust has obtained insurance for the bitcoin held by the Trust, through the Bitcoin Custodian,” the filing added. “Currently, the Bitcoin Custodian, either directly or through an affiliate, procures fidelity (also known as crime) insurance to protect the organization from risks such as theft of funds.”

“Specifically, the fidelity insurance coverage program provides coverage for the theft of funds held in hot or cold storage and provides a limit excess of $200,000,000.”

Bitwise files to list Bitcoin ETF on NYSE Arca

As AtoZMarkets earlier reported, Crypto asset manager Bitwise also filed a Form S-1 with the Securities and Exchange Commission to list its physically held Bitcoin ETF on NYSE Arca, back in January. Bitwise says its product will be based on an index that draws data from large, trustworthy, exchanges. It also will hold bitcoins for the product with a regulated custodian, the firm said. The firm says those qualifications would address the concerns regulators have had about other proposals. 

At the moment, the SEC is yet to make their decision on Bitwise Bitcoin ETF known. However, the commission has sought public opinions from interested parties to “provide written submissions of their views, data, and arguments with respect to the issues identified above, as well as any other concerns they may have with the proposal.”

It is to be noted that Bitwise also applied in July 2018 for the “HOLD 10 Cryptocurrency Index Fund”, which would be the first ETF to track multiple cryptocurrencies weighted by market cap.

SEC Not ready for Bitcoin ETF yet

Elsewhere in the market, the hope for approval of a Bitcoin-backed ETF further dwindles, as the SEC delayed its decision on the VanEck bitcoin (BTC) exchange-traded fund (ETF) proposal, according to an official SEC filing on May 20. As per the filing, SEC is reluctant to give their approval as it has added a 35 day period in order to gather more information and opinions on the proposal that was initially filed by the Chicago Board Options Exchange (CBOE) in 2018.

While some think that the long-awaited darling of the cryptocurrency world could propel the market out of the doldrums into bullish territory, the SEC has cited concerns of manipulation in the underlying spot market. 

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