Investment management company VanEck has decided to change its proposal for a spot Bitcoin (BTC) exchange-traded fund (ETF), as other companies have done.
In the case of VanEck, among the changes made is that the company will be able to receive Bitcoin for its initial funding document filed with the United States Securities and Exchange Commission (SEC).
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The initial financing of an ETF is understood as: Initial capital used to establish the fund. This capital is critical for the ETF to acquire the underlying assets it wants to track and to begin operations. In most cases, companies proposing an ETF make this capital available in fiat currencies (e.g. US dollars), allowing them to purchase the assets they want to track, regardless of whether they are Stocks, bonds, raw materials or others.
VanEck’s decision to accept Bitcoin as seed capital is significant for several reasons: First, because it breaks with “tradition.” As mentioned above, the general rule is that the initial funding is in fiat money. By accepting Bitcoin, VanEck recognizes the growing importance and legitimacy of this digital currency in the financial world.
Additionally, since the proposal has been filed with the SEC, accepting Bitcoin for seed funding could have regulatory implications. If the SEC approves this proposal, it could set a precedent for future ETFs and other financial instruments related to digital assets.
Attorney and ETF specialist Scott Johnsson commented that the language used in VanEck’s amendment is similar to that used by BlackRock. “Perhaps not too surprising given that both issuers are represented by the same lawyers. Except, instead of starting capital with iShares cash [BlackRock]VanEck suggests he will do it with Bitcoin.”
A race for a Bitcoin ETF has broken out in the USA
The VanEck Company ETF is part of list of 12 applications that the SEC has in its hands. The regulator has set the dates by which it must approve or reject ETFs in the first half of 2024.
Gary Gensler, chairman of the regulator, commented on October 19 that the same steps are followed when someone applies to launch a new financial product, including dialogue with applicants:
“Our corporate finance department takes on the task of providing feedback and of course our trading and markets department analyzes the input.”
Gary Gensler, Chairman of the SEC.
Companies such as BlackRock, Grayscale, Fidelity and Ark Invest also submitted changes to their applications, although most were administrative changes, as reported by CriptoNoticias. VanEck’s wish is different from that of the other companies because they too are financed with Bitcoin and not just fiat money.