The cryptocurrency industry has long waited for a reliable exchange-traded fund (ETF) to provide investors with more opportunities for crypto-asset exposure. Finally, these calls have been answered, as a group of finance experts are now gearing up to launch the world’s first Bitcoin ETF.
Bermuda Makes History
According to a recent announcement, Hashdex, a regulated fund manager based out of Brazil, has inked a deal with the Nasdaq exchange to launch the first crypto asset ETF. The investment product, which has been dubbed the “Hashdex Nasdaq Crypto Index,” was approved on September 18 by the Nasdaq and is set to launch on the Bermuda Stock Exchange (DSX).
ETFs offer an insured and regulated means for institutional investors to access greater crypto exposure levels without holding the actual underlying asset. As the announcement explains, the launch will include three million Class E shares on the BSX. A report from Brazilian news outlet Infomoney also explained that the launch would happen before the end of the year.
Infomoney highlighted that Hashdex had chosen the BSX because of Bermuda’s crypto-friendly regulations. Although it didn’t provide more details concerning the ETF, Hadhdex pointed out that the Nasdaq will release all additional information — including the ETF’s methodology — on the investment’s page when it launches.
Writing in the comment section of local news source Ogbolo, Marceo Sampaio, Hashdex’s chief executive, explained that the ETF’s launch would significantly improve institutional crypto investment.
A Stepping Stone for the Crypto Industry
The prospect of improved crypto investments coming amid reports of anticipated surges in institutional demand for digital assets. Per a Decrypt report, Evertas, a British crypto-insurance company, recently surveyed 50 institutional investment firms from the United States and the United Kingdom.
Evertas’ survey sought to find out the state of demand for crypto assets among these investors. As the company pointed out, 90 percent of all firms responded that they expected to see increases in their crypto exposure in the coming five years.
Asked about what they believed would cause this surge, 76 percent responded that they thought there would be an influx in fund managers involved in cryptocurrencies. 80 percent also responded that greater liquidity in the market would improve investors’ perception of cryptocurrencies.
ETFs can help with all of this. Sadly, most top financial markets haven’t quite been as receptive to these assets as expected. In the United States alone, the Securities and Exchange Commission (SEC) had been unforgiving in its disapproval of ETFs.
Over the past few years, several companies — including the Gemini Trust Foundation, Wilshire Phoenix, and VanEck — have submitted proposals more than once for a Bitcoin ETF. The SEC has either rejected these proposals outrightly or frustrated the companies until they withdraw their applications.
Still, there’s hope for a possible ETF soon. This week, Raoul Pal, a former fund manager for banking giant Goldman Sachs, predicted that a Bitcoin ETF launch in the country would happen soon.
“I’m going to give you the biggest front-running opportunity of your life: they will get an ETF across the line. There will be billions of dollars that pour into it. Every pension plan will allocate some money to it,” he said in part.
If that does happen, it could be a ringing sign that the market has truly matured.