Hashdex in Talks with SEC to File Physical Bitcoin ETFs, Importance of Ongoing Dialogue Explained
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Discussion with SEC on Bitcoin ETFs that Buy Physical Bitcoin
A digital asset management firm called Hashdex has been in talks with the SEC about filing its own ETFs that would invest in physical bitcoin, according to an October 24 memo.
Nate Geraci, co-founder of the ETF Institute and host of the ETF Prime Podcast, emphasizes the importance of this ongoing dialogue and explains why it matters to the community in a follow-up post on X.
Looking back to 2022
The memo, which includes a presentation from Hashdex, highlights the development of the CME market to support the firm’s new product. It references Teucrium’s previous order from April 2022 as evidence.
Hashdex recently met with the SEC’s Division of Trading and Markets regarding the Bitcoin ETF (DEFI) filing…
DEFI is a unique program that buys actual Bitcoin from the regulated market (CME).
Interesting information here and shows ongoing dialogue with the SEC. pic.twitter.com/WOhMwKxC0t
– Nate Geraci (@NateGeraci) October 25, 2023
The SEC has recognized the maturity of the CME Bitcoin futures market in the Teucrium Order, stating that it can adequately support exchange-traded products that seek exposure to Bitcoin through CME Bitcoin futures contracts. The SEC also notes that Bitcoin Futures ETFs have not had any adverse impact on settlement prices, spreads, or trading costs for CME Bitcoin Futures.
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Hashdex believes that the growth of open interest by approximately 50% since 2022 implies that ETP trading will not significantly affect CME prices. The firm’s presentation concludes by stating that their order addresses the SEC’s market manipulation concerns and provides important safeguards for investors.
The beginning of the strategic transformation
The New York Stock Exchange filed a 19b-4 offering for the DeFi ETF, which was initially shared on August 25. Under this filing, the Hashdex Bitcoin ETF will shift its focus to holding spot Bitcoin.
*Very interesting* 19b-4 filed by NYSE on DEFI ETF…
Changed name to Hashdex Bitcoin ETF and updated strategy to hold spot Bitcoin.
It is worth noting that this registration does not rely on Coinbase SSA.
Instead, spot Bitcoin will be secured through Physical’s CME exchange. pic.twitter.com/kmXETHUqB0
– Nate Geraci (@NateGeraci) August 25, 2023
This submission stood out for its departure from the traditional reliance on the Coinbase SSA. Instead, it proposed acquiring spot Bitcoin through the CME Market Exchange.
