Exchange-traded fund (ETF) issuers in the US have been creative in their attempts to avoid attention of the Securities & Exchange Commission of the US (SEC). Escape is sought because of strict stance of SEC over crypto and crypto related by-products.
There is always something going on in between crypto, ETF issuers and the SEC in the US. The US watchdog of financials and securities fond of keeping the things tight around crypto and crypto bi-products. Even in the past, harshest disputes arose between crypto coin issuers and the watchdog, wherein in most of them decided in SEC’s favour.
The relationship between the two is more like a cat and mouse. Even after that new administration has taken over charge in the US, still the things haven’t changed a bit.
Recently the ETF issuers in US have been found being very creative. They are devising means to avoid US SEC’s attention and for the time being they are succeeding in their efforts as well. What they are doing is asking approval from the SEC for inaugurating several ETFs which are based on crypto, stocks, equities etc. In the past when they were trying to launch ETF based on crypto only, their applications were straightforwardly rejected.
But in their recent attempts, ETF issuers have been successful most of the times for being able to obtain the approval. For instance one of the ETF issuers had sought permission for launching “Simplify US Equity PLUS Bitcoin ETF”. It was told by approval seeker in the application before SEC that the proposed ETF will be investing at least 15% of the entire assets in digital assets. It categorically suggested that the investment would be done solely or indirectly, as the case may be.
More or less the investment vehicle is opted to be Grayscale Investment’s Bitcoin ETF Fund through which investment will be made. This is a classic case as to how ETF issuers have been sneaking under the nose of US SEC.
It is widely known that if someone is acquiring shares of Grayscale’s Bitcoin ETF Fund, then the investment will exclusively be for Bitcoin. On other hand, Grayscale’s Bitcoin ETF Fund is overwhelmingly used as investment vehicle for exploring major price movements of Bitcoins. Interestingly, such an investment does not require the investor to acquire Bitcoin or put them into their own possession. In fact the assets are kept under management and control of Grayscale Investment which provides secured vault to the investors.
In addition, the investors are also able to facilitate themselves as they don’t need to pay any CGT i.e. capital gain tax. The investment through an ETF is therefore a preferred mode of investing as well as saving extra dollars.
Clearly, therefore the mouse is absconding the cat chase.