WisdomTree is hoping a small tweak will win its bitcoin exchange-traded fund application the blessing of the Securities & Exchange Commission.
The company, which filed with regulators in March, recently said it is "voluntarily applying certain provisions of the 1940 Act to the trust in order to provide investors with some of the significant protections and transparency of the ‘40 act, including daily disclosures." The filing also names US Bank as the custodian, a first for a filer, according to the company.
The SEC is likely to review the revised application in the new year, according to sources familiar with the process.
The move comes after the SEC rejected a similar ETF from VanEck, noting the firm did not demonstrate it could adequately protect investors under exchange rules that are "designed to prevent fraudulent and manipulative acts and practices" and "to protect investors and the public interest."
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While the SEC has not green-lighted a targeted Bitcoin ETF, it has signed off on a handful of ETFs which skim cryptocurrency, including WisdomTree’s Enhanced Commodity Strategy Fund. The firm recently beefed up the ETF by adding a 3% allocation to cash-settled Bitcoin futures traded on the Chicago Mercantile Exchange, giving investors a little crypto mixed in with commodities.
ProShares Bitcoin Strategy ETF also made a splash with its debut on the New York Stock Exchange.
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"Putting together a belt and suspenders approach of the regulated futures market and a regulator ETF really provides a robust solution for investors and one they can just put in their brokerage account, trades like a stock," ProShares Global Investment Strategist Simeon Hyman said during an interview on FOX Business’ "The Claman Countdown."
It's been a volatile but profitable 12 months for bitcoin investors. The largest cryptocurrency by market value is trading around the $49,000 level, down from an all-time high of $66,990.90. Still, it has gained 177% over the past 52 weeks.