Hashdex's Pioneering Path: Exploring the SEC's Stand on Bitcoin DeFi ETF
In a recently disclosed memorandum dated October 24th, Hashdex unveiled their discussions with the SEC concerning their audacious ETF filing. This filing represents a pivotal step towards mainstream adoption of cryptocurrencies, particularly Bitcoin. The aim? To allow investors to acquire physical Bitcoin through the convenience of an exchange-traded fund.
The memorandum not only showcased the determination of Hashdex but also highlighted the maturation of the Chicago Mercantile Exchange (CME) market, reinforcing its capability to support this innovative financial product. It harkens back to the Teucrium Order of April 2022, where the Commission emphasized the maturity of the CME Bitcoin futures market as a foundation for Exchange-Traded Products (ETPs) seeking exposure to Bitcoin.
Hashdex recently met w/ SEC Division of Trading & Markets re: bitcoin ETF (DEFI) filing...— Nate Geraci (@NateGeraci) October 25, 2023
DEFI is unique, wild card filing b/c it will buy physical btc (& take pricing) from regulated market (CME).
Interesting info here & shows ongoing dialogue w/ SEC.https://t.co/7y1r6Yi1PN pic.twitter.com/WOhMwKxC0t
Remarkably, the SEC's stance reflected positively on the influence of Bitcoin futures ETFs, indicating no adverse effects on settlement prices, spreads, or roll costs of CME Bitcoin futures contracts. As such, Hashdex aptly concluded that the surge in open interest since 2022—nearly 50 percent growth—further mitigates the potential impact of trading this ETP on CME prices.
Hashdex's conviction is evident in their closing statement within the presentation: "We believe the unique features of our filing address the Commission’s market manipulation concerns and will provide major safeguards for investors." This sentiment echoes their dedication to not only pioneering in the cryptocurrency sector but also prioritizing the security and confidence of investors.
This ongoing dialogue between Hashdex and the SEC marks the beginning of a strategic shift in the world of cryptocurrency investment. The 19b-4 submission by the New York Stock Exchange (NYSE) for the DeFi ETF, shared on August 25th, is a testament to this shift. Under this submission, the Hashdex Bitcoin ETF would undergo a significant transformation, with a focus on holding spot Bitcoin through the CME Market's Exchange. This departure from the conventional reliance on Coinbase SSA signals a turning point in the way investors can access and interact with digital assets, potentially opening new doors for DeFi enthusiasts and traditional investors alike.
*VERY INTERESTING* 19b-4 filed by NYSE on DEFI ETF…— Nate Geraci (@NateGeraci) August 25, 2023
Changing name to Hashdex Bitcoin ETF & updating strategy to hold spot btc.
Notably, this filing isn’t relying on Coinbase SSA.
Instead will secure spot btc through CME Market’s Exchange for Physical.https://t.co/dBLjCNvAki pic.twitter.com/kmXETHUqB0
Hashdex's innovative spirit, coupled with the SEC's openness to explore this groundbreaking avenue, promises to redefine how we invest in cryptocurrencies. As the dialogue continues and the future unfolds, it's a testament to the rapid evolution of the digital asset landscape, offering a glimpse of the exciting possibilities that lie ahead. The world of finance is on the brink of a transformative journey, and Hashdex is leading the way.