Valkyrie Digital Assets filed for a Bitcoin ETF with the US SEC

By: Jinia Shawdagor
Jinia Shawdagor
Jinia is a cryptocurrency and blockchain enthusiast based in Sweden. She loves everything positive, travelling, and extracting joy and… read more.
on Jan 26, 2021
  • The Valkyrie Bitcoin Fund will be listed on NYSE if the SEC approves it.
  • Per Valkyrie Investments, Coinbase Custody Trust Company would be the ETF’s custodian.
  • VanEck also resubmitted its BTC ETF application at the end of 2020.

Texas-based Valkyrie Digital Assets has filed for a bitcoin exchange-traded fund (ETF) with the US Securities Exchange Commission (SEC).  The firm filed this application on January 22, noting that the proposed ETF is named Valkyrie Bitcoin Fund. Per Valkyrie Investment, the parent company of Valkyrie Digital Assets, its subsidiary seeks to list its ETF on the New York Stock Exchange (NYSE) if the SEC approves it.

According to the filing, Coinbase Custody Trust Company will act as the custodian for the proposed ETF. While this is Valkyrie’s first BTC ETF filing, the firm has reportedly launched numerous ETFs based on other assets. Per Leah Wald, Valkyrie Investments’ CEO, the company has also issued publicly-traded funds and ETPs.

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Wald further disclosed that the team behind the Valkyrie Bitcoin Fund comprises Steven McClurg and John Key. Together, these appointees have worked on more than 100 esoteric and novel deals, which have passed regulatory scrutiny.

SEC’s fight against BTC ETFs

The crypto space widely believes that a Bitcoin ETF would significantly help boost BTC’s adoption. This is because, through an ETF, bitcoin would trade on the stock just like ordinary shares. However, the SEC has for years rejected BTC ETF applications citing market volatility and price manipulation. For instance, the agency rejected nine BTC ETF applications on the same day back in August 2018.

At the time, the commission noted that it had rejected the applications from ProShares, Direxion, and GraniteShares because the organizations had not met their burden under the Exchange Act and the Commission’s Rules of Practice to demonstrate that their proposals are consistent with the requirements of the Exchange Act Section 6(b)(5). The SEC added that the applicants had particularly failed to observe the requirement that mandates for the rules of national securities exchanges to be designed in a way to prevent fraudulent and manipulative acts and practices.

Although the SEC is not keen on approving BTC ETFs, the crypto space seems resilient in its quest to make cryptocurrencies mainstream. Before Valkyrie’s application, VanEck resubmitted its BTC ETF application on December 30, 2020. According to the firm’s CEO, Jan van Eck, the organization decided to resubmit its ETF application based on a few rays of hope. Per Eck, the first reason was the guide document that the SEC published on crypto custody. The second was Canada’s regulatory developments that saw the country’s regulators approve a crypto fund targeting retail investors.

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