What Does the Spot Bitcoin ETF Approval Mean for Crypto

On Wednesday, Jan. 10, the Securities and Exchange Commission (SEC) approved the first-ever spot Bitcoin ETFs, including those from Fidelity, BlackRock and Invesco. In total, the SEC approved 11 spot Bitcoin ETFs. They’re expected to start trading as soon as this week, and their upcoming launch has already had an impact on cryptocurrency markets. The price of Bitcoin jumped more than 7% over the course of Monday, Jan. 8, when CNBC reported that sources close to the SEC said approval was imminent. But wait — weren’t there already Bitcoin ETFs on the market? Yes and no. There were already crypto-related ETFs and trusts out there, but there has never been a spot Bitcoin ETF on the market before Wednesday’s approval. What is a spot Bitcoin ETF? A spot Bitcoin ETF is an exchange-traded fund — a highly liquid fund that changes price throughout the trading day, just like a stock — that directly tracks the price of Bitcoin, primarily by holding a large amount of the cryptocurrency itself. It’s similar to a spot gold ETF, which holds physical gold bullion on behalf of its shareholders. These are the first spot Bitcoin ETFs to win SEC approval to trade on a major exchange, although there are other funds on the market that attempt to track the price of Bitcoin by other means. For example, before converting, the Grayscale Bitcoin Trust (GBTC) invested directly in Bitcoin, but as a trust, it lacks the ability to keep its price close to its net asset value (NAV). ETFs can do this by creating and retiring shares in response to investor demand. But since it can’t, GBTC often trades at a discount or premium to its NAV — that is, its returns often diverge from those of Bitcoin. There are also funds like the ProShares Bitcoin Strategy ETF (BITO) — a proper ETF that trades on a major exchange near its NAV but invests in Bitcoin futures, not Bitcoin itself. Its returns can also diverge from those of Bitcoin. As the first spot Bitcoin ETFs, the recently approved ETFs are the first cryptocurrency funds to offer the best of all worlds — they will trade on a major exchange, keep their prices near their NAVs, and hold Bitcoin directly. How many spot Bitcoin ETFs were approved? What are the fees? Ten different would-be spot Bitcoin ETF issuers filed forms with the SEC earlier this week, disclosing the fees they intend to charge. Hashdex, which applied to hold spot Bitcoin in its crypto futures ETF, was also approved, bringing the total to 11. Some funds are looking to launch new Bitcoin ETFs, while others have existing funds that they are looking to convert into ETFs. Below is a list of the approved ETFs and their fees:ETF name & symbolFeeNotesArk 21Shares Bitcoin ETF (ARKB)0.21%Fee waived for first six months of trading or first $1 billion in fund assets, whichever comes first. Bitwise Bitcoin ETF (BITB)0.24%Fee waived for first six months of trading or first $1 billion in fund assets, whichever comes first.iShares Bitcoin Trust (IBIT)0.25%Fee reduced to 0. All data is taken from the source: http://nerdwallet.com Article Link: https://www.nerdwallet.com/article/in... #BitcoinETF #newstodayusa #newstodaybbc #newsworld #newstodayinusa #newstoday #