In the ever-evolving landscape of investment opportunities, Exchange-Traded Funds (ETFs) have emerged as a versatile and popular choice for both seasoned and novice investors. Among the diverse array of ETFs, the spot market ETF stands out as a dynamic and intriguing option. In this article, we delve into the intricacies of spot market ETFs, exploring what sets them apart and how they can be a valuable addition to your investment portfolio.
Understanding Spot Market ETFs:
Spot market ETFs, also known as physical ETFs, are investment funds designed to closely track the performance of a specific basket of assets in the spot market. Unlike synthetic or derivative-based ETFs, which use financial instruments like futures and options to replicate the index they track, spot market ETFs directly hold the underlying securities or assets.
The Core Concept:
The term “spot market” refers to the market where financial instruments and commodities are bought or sold for immediate delivery and settlement. In the context of spot market ETFs, this means that the fund invests in the actual assets that make up the index it aims to replicate. For example, a spot market ETF tracking the S&P 500 would own shares of the companies within the S&P 500 index.
Key Features of Spot Market ETFs:
Transparency: Spot market ETFs offer a high level of transparency as they disclose their holdings on a daily basis. Investors can easily see the specific assets held by the fund, providing a clear picture of where their money is invested.
Low Tracking Error: Since spot market ETFs directly own the underlying assets, they tend to have lower tracking errors compared to synthetic ETFs. Tracking error measures the divergence between the ETF’s performance and the index it aims to replicate.
Dividend Income: Investors in spot market ETFs may benefit from dividend income generated by the underlying assets. This can be appealing for income-focused investors seeking a steady stream of returns.
Creation and Redemption Process: Spot market ETFs utilize an “in-kind” creation and redemption process. Authorized Participants (APs) can exchange a basket of securities for shares of the ETF (creation) or exchange ETF shares for the underlying securities (redemption). This process helps keep the ETF’s market price closely aligned with its Net Asset Value (NAV).
Cost Efficiency: Spot market ETFs often have lower expense ratios compared to actively managed funds. The efficiency of the in-kind creation and redemption process contributes to cost savings, making them a cost-effective investment option.
Conclusion:
Spot market ETFs offer investors a straightforward and transparent way to gain exposure to a diversified portfolio of assets. With their focus on the actual ownership of underlying securities, these ETFs provide a tangible and efficient means of tracking market indices. Whether you are a passive investor looking for a long-term strategy or an active trader seeking liquidity, spot market ETFs can be a valuable tool in achieving your financial goals. As with any investment, it’s crucial to conduct thorough research and consider your own risk tolerance and investment objectives before incorporating spot market ETFs into your portfolio.
This material is meant for educational and recreational purposes only. It is not financial advice in any way; therefore, damage caused by the information provided here is not liable to the company or the writer in question. Please make due diligence and conduct your own research before taking any action prompted by the information provided above.
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US SEC is now approaching the climax of deciding on the ongoing spot Bitcoin approval race by TradFi institutions.
Today is the start of the first window for the commission to approve all of the 12 filed spot Bitcoin ETFs.
The US SEC has just entered an eight-day window that starts between Nov. 9 and Nov. 17, where it can approve all 12 spot Bitcoin ETF filings. Bloomberg analysts believe there is a 90% chance all 12 ETFs will be approved by Jan 10.
Will we see an approval of a spot Bitcoin ETF anytime soon?
Since Q2 this year, major TradFi institutions in the US have been racing against each other to bring spot Bitcoin and Ethereum ETFs to their customers first. However, to make the ground fair, the US SEC is expected to be approving all BTC and ETH ETFs at ago to avoid giving any institution a market advantage over the other.
The question of whether we will see any spot Bitcoin ETF approved this year has been pondered by multiple analysts and founders in the crypto space. According to an X.com post by Bloomberg ETF analyst James Seyffart, the US SEC just entered an eight-day window where it can approve all the twelve spot Bitcoin ETFs.
New Research note from me today. We still believe 90% chance by Jan 10 for spot #Bitcoin ETF approvals. But if it comes earlier we are entering a window where a wave of approval orders for all the current applicants *COULD* occur pic.twitter.com/u6dBva1ytD
Seyffart said that he still believes in a “90% chance by Jan 10 for spot Bitcoin ETF approvals.” however, there is still a chance that in this first window “, a wave of approval orders for all the current applicants *COULD* occur.”
The US SEC had issued delay orders on spot Bitcoin ETFs at the same time to allow all the 12 applicants to review their applications and be ready for launch. The commission further pointed out that Nov. 8 would be the last day to receive comments on the applications.
However, according to Seyffart, it is still not going to happen that in this window, all the applicants will get their ETFs approved. The reason behind it is that the US SEC has set Nov. 17 as a recommencing period for 3 ETFs, including Hashdex Bitcoin ETF, Franklin Bitcoin ETF and Global X Bitcoin Trust. That means these three applications can only be approved as of Nov 23 at the earliest.
This material is meant for educational and recreational purposes only. It is not financial advice in any way; therefore, damage caused by the information provided here is not liable to the company or the writer in question. Please make due diligence and conduct your own research before taking any action prompted by the information provided above.
For more resources like this one, keep watching our website and remember to follow our socials to stay ahead of the curve. Thanks for believing in us. Your support is appreciated.
According to US laws, the US SEC is bound to give a decision regarding the approval process of an ETF 45 days after the initial filing. This week will see the end of those days regarding a group of Bitcoin spot ETFs filed with the regulator.
Galaxy Digital CEO Mike Novogratz expects this week’s decision to be an announcement of an approval delay but to be approved in the next 4 to 6 months.
The clock is ticking for US SEC to make its stand publicly on Bitcoin Spot ETFs, as 45 days are since a series of Bitcoin Spot ETFs were filed with the regulator at the end of this week. Consequently, Galaxy Digital CEO Mike Novogratz thinks the most likely decision would be a delayed response, but markets might see an active Bitcoin Spot ETF in the next 4 to 6 months.
A step closer to the US SEC Bitcoin Spot ETF decision?
Bitcoin has taken international markets by storm prompting big asset managers like BlackRock to soften their hearts and warm up to the idea and innovation behind the coin. In June, BlackRock led a series of traditional finance institutions to file for Bitcoin spot ETFs.
This week will see 45 days that the US SEC has to respond to the filings end. As such, it is expected to issue an official statement regarding the filings. However, as seen before, the regulator always takes its time before making such decisions, given there is a large number of filings at the moment.
Both Ethereum and Bitcoin spot ETF filings from TradFi institutions now have a count of over 20. As such, the US SEC would likely choose to delay the decision to approve any of them at this point.
Consecutive approval in 2024?
ARK Invest’s CEO Cathie Woods has called on the US SEC to approve all Bitcoin spot ETFs consecutively to avoid giving any company a market advantage over the other, given that most TradFi competitors have filed for similar assets. Her remarks called on the US SEC to ensure that no companies get a competitive advantage to make the markets fairer, as approving these assets may open the door to further mainstream adoption.
While this is possible, it still needs more time to become a reality. Galaxy Digital CEO thinks it could take 4 to 6 months for the regulator to approve these assets despite its 45 days to respond per US securities law ending this week. That pushes the possible approval dates to 2024.
According to "contacts" from inside BlackRock and Invesco spot Bitcoin ETF approval a matter of "when, not if" likely in "four to six months" — Galaxy CEO Mike Novogratz on earnings call this morning pic.twitter.com/TIhHC7xnHI
However, none of the above possibilities are guaranteed as no insider or official information from the regulator has been made public yet. Keep watching Fintech Express for updates on this story as soon as it happens.
Grayscale has asked the US SEC to consider approving all pending Bitcoin ETFs simultaneously so no company gets an advantage over the other.
The US SEC is expected to approve the first-ever BTC ETFs that offer almost direct exposure to the premiere cryptocurrency now that TradFi organizations like BlackRock have joined the race.
Grayscale, a Bitcoin ETF applicant, has asked the US SEC to consider approving all Bitcoin ETFs simultaneously to ensure no company has an advantage over the other as competition grows.
Bitcoin ETFs continue stealing the show
Bitcoin ETFs have continued to be the talk of the town as investors expect them to change the crypto market and mark a turnaround in the adoption culture of the assets. This turnaround has resulted from a growing interest from TradFi firms and other institutions.
BlackRock first disclosed that it was going into the crypto space via an application for a Bitcoin ETF. As a result, many other traditional finance institutions followed closely and filed for similar assets to keep them competitive against the company.
One of the first companies to ever apply for a Bitcoin ETF, Grayscale, has been talkative about the saga asking the US SEC to consider a simultaneous approval of the assets so no company gets approval earlier than the others. In July 27 post, the company’s Chief Legal Officer Craig Salm submitted a letter to the US SEC regarding the existing eight spot Bitcoin ETF fillings.
Grayscale added that it’s skeptical about the passing of the ETFs that have been filed with sharing agreements SSAs, with Coinbase, terming it as a “not a new idea” and saying it would be hard to meet SEC’s standards.
The SEC should approve spot #bitcoin ETFs to trade in the US. What’s more, their previous approval of bitcoin futures ETFs shows that they are already in a position to do so. Read more about the latest from our legal team: https://t.co/UC8ksqNcwy$GBTC$BTC
Further concerns on the ties with Coinbase continue as the exchange is under a lawsuit and investigation by the US SEC on violation of securities laws. However, neither the lawsuit nor the ETF applications have reached final levels of determination, which leaves most of the developments in limbo.
Keep watching Fintech Express for more updates on Bitcoin ETFs applications in the US and other Fintech-related developments.
The US SEC has accepted Valkyries BRRR spot Bitcoin ETF for review
The development comes soon after the regulator accepted Blackrock’s spot bitcoin ETF application for review as well
Valkyries BRRR spot Bitcoin ETF is now officially under the US SEC review process after the regulator expressed that it had been satisfied with the filing. This ETF was named ‘BRRR’ after a popular meme in the Bitcoin community that refers to the money printer sound.
Valkyries BRRR spot Bitcoin ETF accepted for review by the SEC.
The US SEC has begun reviewing the popular Valkyries BRRR spot bitcoin ETF. This ETF, named after a popular meme in the crypto industry, was filed as an answer to BlackRock’s spot Bitcoin ETF.
BlackRock’s CEO Larry Fink has moved from thinking that Bitcoin is a scam in 2017s to acknowledging that it’s a ‘digital gold’ and wanting to expose his investors to it. Other TradFi institutions have joined the queue to file for similar assets, including Valkyrie.
Per data from the SEC’s Nasdaq rulemaking list, Valkyries BRRR spot Bitcoin ETF proposal has entered an official docket as of July 17. This filing was accepted after BlackRock’s was accepted four days apart on July 13.
This acceptance opens the road for US SEC officials to look into the key details of the filing and determine if it is fit to be offered to US markets. These ‘TradFi crypto take over’ filings are expected to be approved, opening flood doors of institutional investors to the crypto market.
However, only time will tell what happens now that the US SEC is not the biggest fan of how the crypto industry is being run. Keep watching Fintech Express for more updates on this and other fintech-related developments.
