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Crypto asset manager Hashdex has caused a stir by filing an application with the US Securities and Exchange Commission (SEC) for a spot bitcoin ETF.
The filing details that the Hashdex Bitcoin ETF intends to source its bitcoin assets directly from exchanges affiliated with the Chicago Mercantile Exchange market.
Seasoned analysts, including Bloomberg’s James Seyffart, analyzed the filing and revealed a strategy primarily focused on exchange-traded position trades.
This method involves trading futures contracts against an equivalent spot exposure, which distinguishes it from direct cash purchases on other exchanges.
The spot bitcoin ETF landscape is undergoing a notable shift due to the SEC’s decision to withhold feedback until the following year. This heightened sense of anticipation is now accompanied by an even greater level of tension as market participants closely monitor the evolving situation.
The Grayscale situation
Amid these developments, the ongoing Grayscale saga continues as the U.S. Circuit Court of Appeals again defers a decision on Grayscale’s attempt to convert its popular Bitcoin Trust into a standard spot Bitcoin ETF.
Craig Salm, Grayscale’s Chief Legal Officer, made the disclosure on Aug. 22, stating that the anticipated trials related to Grayscale are pending and that no judgments have been issued in any instance, including non-Grayscale cases had.
Consequently, there remains uncertainty regarding the future of the Bitcoin (BTC) spot ETF and other pending matters.
More spot competitors for bitcoin ETFs
The first ETF filing came as the Winklevoss Bitcoin Trust, the first Bitcoin exchange-traded fund (ETF) launched by Cameron and Tyler Winklevoss in 2013, suffered setbacks when the SEC rejected their efforts in 2017 and twice in 2018 .
The concerns revolved around allegations of fraud and market manipulation. Grayscale took an alternative route by launching the Grayscale Bitcoin Trust (GBTC) on the OTC market in 2017, bypassing the lengthy SEC approval process.
ProShares and Bitwise entered the ETF battle in 2017 and 2019, respectively, with their Bitcoin ETF filings. Both were rejected in 2018 and 2019 due to market manipulation and investor protection concerns. Even the Realty Shares ETF Trust planned a Bitcoin ETF in 2019, but abandoned it two days later. WisdomTree’s 2022 Bitcoin ETF proposal met a similar fate, as the SEC felt it was not in the public interest and did not provide adequate protections against fraudulent and manipulative behavior.
Other organizations — including BlackRock, ARK Investment Management, Bitwise, and VanEck — are also vying for a spot Bitcoin ETF.
ARK, led by investor Cathie Wood, approached the SEC with a BTC ETF application in April and is reportedly queued ahead of BlackRock.
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