VanEck and SolidX bring “limited” Bitcoin Trust (“ETF”) on the market

On Tuesday, the news came on that VanEck and SolidX, two companies that have been working for several months on an approval for a Bitcoin Exchange Traded Fund (ETF), announced that they were from the 04. September, a Bitcoin ETF on the market. This seems to be true, however, only “limited”.

As Bloomberg reported, declared VanEck and SolidX, that you have a “work arround-product” for a Bitcoin ETF, based on a historical rule of the securities act, as of today, the 04. September 2019, will publish. As a result, the two companies are in the position, shares of the VanEck SolidX Bitcoin Trust to qualified institutional investors.

In the crypto-scene, it was fast, VanEck, and SolidX will deliver after several attempts, finally a Bitcoin ETF, by eliminating small investors and apply the rule that allowed the sale of shares only to certain institutional investors. According to the notice, the SEC Rule 144A allows the sale of privately placed securities to qualified institutional buyers, such as registered investment advisers, and hedge funds:

Qualified institutional buyers (QIBs), are generally defined as an institution with a Portfolio of securities; a value of more than USD 100 million owned or under its management, a registered Broker-Dealer with a minimum of USD 10 million in securities owned or under management and a Bank or savings Bank which has both (i) at least USD 100 million in securities of third parties or, in its discretion, invest, and (ii) an audited net worth of at least USD 25 million has.

Examples of QIBs can be business development companies, companies, ETFs, hedge funds, insurance companies, investment funds and registered investment Advisor. A natural Person shall not be regarded as a QIB. Broker, acting with the 144A shares shall be responsible to confirm the QIB Status of the buyer.

As this news spread, called a lot of the product quickly, an “ETF”, one that “was limited” (“Limited ETF”), but still an ETF. But according to the crypto-lawyer Jake Chervinsky, the name Bitcoin ETF is misleading. Chervinksy pointed out in the below Tweet, that the “limited ETF”classification is a “nice Marketing strategy”. In reality, the product of VanEck the Bitcoin Trust (GBTC) is a Grayscale very similar.

This is misleading. The VanEck SolidX Bitcoin Trust, which is *not* to ETF. It looks exactly like the Grayscale Bitcoin Trust, which was launched almost six years ago. Calling this a “limited ETF” is a cute marketing strategy, but that’s about it. Calling it a full ETF is just wrong. https://t.co/e5kyeAE4gC

— Jake Chervinsky (@jchervinsky) September 3, 2019

The Pro-Bitcoin Economist Alex Kruger followed this example, and joked that it was, as you would to buy a Bicycle and use it as a “limited edition motorcycle” means. He added that this product is only for “institutions with assets under management of over $ 100 million, registered Broker-dealers and banks” available.

Van Eck’s details: https://t.co/tuxz62gLvl

Grayscale’s: https://t.co/OPGYupGCwR

Key difference: Van Eck’s to allow for continuous, open-end creation/redemption of shares, allowing price to track Net Asset Value (NAV) closely … GBTC does not and thus often trades at a premium.

— Alex Krüger (@Krug macro) September 3, 2019

Nevertheless, many experts are of the opinion that the publication of this “Bitcoin will help Trusts” to support the recovery of Bitcoin. Krueger wrote in a later Tweet that this was bullish and the Bitcoin price a higher probability of the outbreak to the top give. Since the Bitcoin Trust of Grayscale currently houses thousands of BTCs (more than 1% of all BTC), it would be nonsense to claim that this can catalyze off-exchange ETF-related products no capital inflows in the crypto currency markets.

As previously reported, Bakkt his physical Bitcoin Futures on 23. September on the market, two weeks after it has begun this week with the storage of BTC for customers. The Wolf of All Streets, a prominent Trader, argued that the Start of the stock exchange “the good “camper will be the most event for institutional investors in the history of Bitcoin”.

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