Investors started trading the first Bitcoin Future ETF last week, marking a major milestone in cryptocurrency can use payment.
The fund invests in Bitcoin futures. These are deals to buy or sell assets in the future at a current agreed price. This allows trading to be done through regular investment accounts, rather than relying on cryptocurrency exchanges. The industry is keen to see more. ETFs also invest in encryption. The entire industry is still interest in this matter. It will have an impact on other industries.
ProShares Bitcoin Future ETF
The ProShares Bitcoin future Strategy ETF received more than $550 million from investors who interested in cryptocurrency. The Morningstar report states that the transaction volume was over US$1.01 trillion.
The most important thing was that Bitcoin’s price soared twice. Its value reached US$64206.51. It was up 4% Tuesday and then it surpassed US$66,000 Wednesday, breaking the record of more than US$2,000.
Ben Johnson, Head, Global ETF Research at Morningstar said:
"Bitcoin's original purpose is, of course. It is still the goal for many. It's an attempt to subvert conventional finance. Traditional finance, however, has taken Bitcoin on a tractor-block and roll. Enter and transform it into something that can generate millions, or even billions of USD through the creation of this new ecosystem.
Knowledge of Bitcoin Futures ETF
While the Bitcoin futures ETF is appealing to many, many experts advise that you do your research before investing. While it might seem ahead of schedule for some, the fact is that prices fluctuate and you should exit before they drop. Important to note that although the fund is closely linked with Bitcoin, it doesn’t necessarily reflect its value. It will instead track futures prices which are highly unpredictable.
You should not put all your eggs into one basket. You can get involved in a few things until you realize that this is one thing. However, filling your entire portfolio full of these ETFs will be a different matter. You should avoid investing in things you cannot afford. If you are looking for something familiar and potentially lucrative, don’t. You might consider other Bitcoin or cryptocurrency trades directly. But it is common, even banking will practical crypto.
Approval for Bitcoin ETF Is slow
It might seem like a novel idea to create a US Bitcoin ETF, but it’s not. It is a fact that the company has been trying for Bitcoin ETFs for ten years. However, approval by the US Securities and Exchange Commission has been slow. Why is this? The organization claims that any other party does not adequately regulate the bitcoin. There is a high possibility of manipulation and fraud.
The majority of Bitcoin future ETF applications are built using the “spot market”, which is basically investing directly in the currency. In August, Gary Gensler, the Chair of the SEC, suggested that futures-backed Bitcoin ETFs might be more accessible to investors. He believed it would be safer to work with them.
These changes attract a lot of attention before they approve this week. The Commodity Futures Trading Commission is closely monitoring the US Bitcoin and ETFs that fall under the SEC’s jurisdiction. Although investors may be able to see some protection, it is still highly speculative.
The US Securities and Exchange Commission will approve more Bitcoin ETFs in future. But what about ETFs that invest only in cryptocurrency? Experts say this is unlikely to happen anytime soon.