The SEC has announced that a Bitcoin ETF application from a company called Kryptoin Investment Advisors is now officially under review.
It’s one of nine active applications for an exchange-traded fund for Bitcoin, three of which are now under review. WisdomTree and VanEck are the other two.
Kryptoin was founded in 2016 with the goal of producing a Bitcoin ETF.
It’s run by Jason Toussaint, who was previously involved with gold investments.
In 2019, Kryptoin gave its first shot at getting approved. Kryptoin re-filed the paperwork earlier this month in an amendment to its first attempt.
A Bitcoin ETF offers exposure to Bitcoin without the burden of directly holding it. It offers comfort to crypto-curious institutional investors.
For now, the closest thing are Bitcoin trusts, which are ETF-like if not quite true ETFs. The most popular of these is the Grayscale Bitcoin Trust (GBTC), from Grayscale Investments.
Where ETFs let you redeem shares for the underlying asset, the Grayscale Bitcoin Trust does not. It’s also not very closely correlated to the price of Bitcoin—GBTC has been trading at a discount for the past two month, which means the price of GBTC shares is now about 19% lower than the trust’s NAV (net asset value).
Canada and Brazil got their own Bitcoin ETFs in recent months, and investors are optimistic that the SEC’s new crypto-conscious chairman, Gary Gensler, will approve one in the near future.
In the past, the SEC in its denials of ETF applications has dismissed the idea that there’s a “real” market for Bitcoin — meaning, one that isn’t being easily manipulated.