Bitcoin will make a historic entry, through the back door, to the New York Stock Exchange on Tuesday with the launch of an ETF investment fund, linked to the evolution of the popular digital currency, listed for the first time on Wall Street.
This is a highly anticipated event in the cryptocurrency world and has propelled bitcoin above $ 62,000 in recent days, its highest since April.
ProShares’ index fund (ETF), which will track the bitcoin futures market, will begin trading on the NYSE on Tuesday under the acronym BITO, the ETF firm said in a statement on Monday.
A spokesperson for the New York Stock Exchange confirmed to AFP that this first index fund linked to a cryptocurrency will be traded as soon as the market opens at 9:30 a.m. on Tuesday.
By purchasing shares of this new ETF, investors are not going to bet directly on bitcoins, but they will be placing their money in an array of bitcoin-related futures contracts.
ETF index funds are investment vehicles in which savers can buy and sell units at any time, unlike most traditional funds, which have entry and exit windows.
They have grown exponentially over the past twenty years and now weigh over $ 5 trillion in the United States, which represents 70% of the global market.
“ProShares, a leading ETF provider, plans to launch (Tuesday) the first bitcoin-linked ETF in the United States […], this is a major milestone for ETFs,” the fund said in a statement. communicated.
Bitcoin-exposed ETFs already exist in Asia and Canada, but this is the first time that the US market, with the world’s largest financial base, has opened up to this type of product.
The market policeman, the SEC, did not oppose the launch of this fund, although it had done so several times in the past for others.
But the regulator issued a warning tweet late last week, reflecting doubts and criticism over new digital assets. “Before investing in a fund that holds future bitcoin contracts, make sure you weigh the risks and rewards,” the SEC wrote.
“BITO will offer investors the possibility of easily exposing themselves to bitcoin returns, via a brokerage account […] which eliminates the need for an account on a cryptocurrency exchange and a crypto wallet”, says ProShares, a division of the ProFunds group that manages $ 29 billion in assets and a dozen ETFs.
Driven in particular by this eagerly awaited IPO, the price of bitcoin has soared for the past month, gaining some 40% and approaching its all-time high reached six months ago at $ 64,870.
“We believe there are a multitude of investors eagerly watching for the launch of a bitcoin-linked ETF after years of trying to launch one,” ProShares CEO Michael Sapir said on Monday.
“We remember 1993 and the first stock ETF, 2002 for the first bond ETF and 2004 for the first gold ETF. 2021 will be remembered for the first ETF linked to a cryptocurrency, ”says the company.
Several other fund managers are also in the starting blocks to offer this type of new financial product to the stock market and have made requests in this direction to the policeman of the Stock Exchange, the SEC. Among them are the Valkyrie Investments or Invesco funds.
The emergence of this new cryptocurrency-backed investment product is another sign of the growing legitimization of digital currencies, which accelerated in 2021.
The cryptocurrency market has experienced growth described as “phenomenal” by the International Monetary Fund (IMF) which evaluated their capitalization at the end of September at more than 2000 billion dollars, the main part being represented by bitcoin in the first place, followed by l ‘ether.
Six months ago, America’s largest bitcoin exchange, Coinbase, broke onto Wall Street.
Founded in 2012 in San Francisco (California), the platform allows you to buy and sell around fifty cryptocurrencies. It is valued on the stock market at more than 60 billion dollars.