Valkyrie has applied to the US Securities and Exchange Commission (SEC) to add ETH futures contracts to its Valkyrie Bitcoin Strategy ETF (BTF).
Valkyrie makes an effort to stay ahead of the crowd
Valkyrie’s application represents a step to get ahead of the crowd. While many have applied to launch their respective Ethereum (ETH) Exchange-Traded Funds (ETFs), Valkyrie simply took the step of incorporating exposure to ETH futures contracts into their existing investment strategy.
While the likelihood of the SEC approving these Ethereum ETFs or in what order remains uncertain, Valkyrie plans to introduce its dual approach on or around October 3, putting its launch date ahead of other competitors.
Part of the submission reads:
In addition, the Fund is expected to change its name to Valkyrie Bitcoin and Ether Strategy ETF on or about October 3, 2023. The Fund is expected to continue trading on The Nasdaq Stock Market LLC under the ticker symbol “BTF”. The foregoing amendments will only become effective and subject to the effectiveness of Post-Effective Amendment No. 23 of the Trust under the Securities Act of 1933, including any amendments thereto, filed with the Securities and Exchange Commission on August 4, 2023. and contains more information about the changes to the Fund’s name and investment strategy.
Per SEC Rule 485(a), those who applied for the Ether ETFs can start 75 days after their respective filing dates if none of the applications are rejected before the SEC. Along with the 75 days, the earliest launch of any of these fund managers (the first was Volatility Shares, which filed on July 28) is October 12 (9 days after Valkyrie’s proposed launch if their filing gets the green light from the SEC) .
ETH retains $1,800 level | Source: ETHUSD on Tradingview.com
This first-mover advantage may prove critical when we look back at history. Although Valkyrie launched its Bitcoin fund in October 2021, it wasn’t the first to do so, as ProShares had already launched its Bitcoin Strategy ETF (BITO).
Many believe that launching BITO first is one of the reasons why it has had more success when compared to Valkyrie’s Bitcoin Strategy ETF (BTF). BITO now has more than $1 billion in assets under management (AuM) compared to BTF’s AuM of about $30 million.
Deja Vu?
As Bloomberg Senior ETF Analyst Eric Balchunas pointed out in a tweetthis isn’t the first time someone has modified an existing fund to launch the industry’s first such product.
ETF Managers Group has previously converted a Latin American real estate ETF into the ETFMG Alternative Harvest ETF (MJ), so it could be the first in line to launch marijuana ETFs in the US – something that has been compared to what Valkyrie trying to do Do.
Featured image from iStock, chart from Tradingview.com