Canada Approves Direct Custody Bitcoin ETF
Purpose Investments Inc. (“Purpose Investments”) is pleased to announce that it has been cleared by Canadian securities regulators to launch Purpose Bitcoin ETF (the “ETF” or “BTCC”), the first direct custody Bitcoin ETF in the world. The ETF is designed to provide investors with exposure to the leading cryptocurrency, Bitcoin, by investing directly in physically settled Bitcoin.
“Bitcoin has been gaining popularity among individual and institutional investors for years now, however it remains a difficult asset to gain efficient and secure exposure to,” said Som Seif, founder and CEO of Purpose Investments. “Purpose Bitcoin ETF will change the landscape for investors by giving them a simple, efficient and affordable way to directly access the cryptocurrency.”
Great news for investors looking for easy and secure access to cryptocurrency. Find out more about our next major ETF innovation (it’s a world’s first!). #Bitcoin #cryptocurrency #ETFs https://t.co/kHTcSuUgKi
— Purpose Investments (@PurposeInvest) February 12, 2021
The ETF will be the first in the world to invest directly in physically settled Bitcoin, not derivatives, allowing investors easy and efficient access to the emerging asset class of cryptocurrency without the associated risk of self-custody within a digital wallet. Similar to physically backed gold or silver products, the ETF will always be backed directly by physically settled Bitcoin holdings.
Bringing the first Bitcoin ETF to the market brought many unique challenges including the requirement of daily liquidity and various mechanisms to satisfy adherence to standards within both traditional ETF markets and the digital asset industry. Bitcoin holdings are kept in “cold storage” – the most secure custody solution in the market. Purpose Investments is proud to be working Gemini Trust Company, LLC as sub-custodian and CIBC Mellon Global Securities Services Company as fund administrator to provide investors with confidence regarding the safe and effective purchase, settlement, custody of Bitcoin and administration of the ETF.
Purpose Investments worked in close coordination with the Ontario Securities Commission (“the OSC”) through a confidential filing process through a series of meetings and presentations over the course of many months to finalize the launch of the ETF.
“The OSC was a crucial working partner in the launch of Purpose Bitcoin ETF and we are grateful for their willingness to work with us through this process. Their cooperation and guidance made it possible for us to move forward on getting this novel ETF into the hands of investors,” Seif added.
The ETF’s daily NAV will be priced based on the daily spot price of the TradeBlock XBX Index.
The Bitcoin ETN futures are based on ETC Group’s physical Bitcoin ETN.
Gensler suggests Bitcoin ETF filings limited to CME-traded futures would be welcomed by SEC.
It is hoped that BNY Mellon will provide transfer agency and ETF services when the fund converts to an ETF.
Increase in institutional demand highlights growing legitimation of bitcoin.
There has been more institutional volume than anticipated.