The SEC is still unwilling to approve a spot bitcoin ETF.

Valkyrie, an investment firm, has filed a new application for a Bitcoin futures-based exchange-traded fund (ETF) called BTFD. The firm aims to list the ETF on NASDAQ. Unlike their existing BTF fund, this new fund will be leveraged, allowing speculators to increase their exposure to Bitcoin. The ticker symbol “BTFD” is a reference to a popular meme in the finance Twitter community. The initial plan was to use this ticker for the first fund, but it was later changed in October 2021. Valkyrie has not yet commented on the matter. (Decrypt)

Both of Valkyrie’s Bitcoin-focused funds do not directly hold Bitcoin. Instead, they utilize Bitcoin futures traded on the Chicago Mercantile Exchange (CME). Futures contracts are agreements to buy or sell an asset at a predetermined time, quantity, and price. Currently, there are four Bitcoin futures-based ETFs available, with the first one being ProShares Bitcoin Futures ETF, which launched in October 2021. However, there are no ETFs that provide direct exposure to Bitcoin due to the Securities and Exchange Commission (SEC) rejecting all applications for spot Bitcoin ETFs, citing concerns about market manipulation.

Digital asset manager Grayscale is currently in a legal battle with the SEC over its Grayscale Bitcoin Trust product, which it wants to convert into a spot Bitcoin ETF. Grayscale argues that approving futures-based ETFs instead of spot ETFs is illogical and questions the SEC’s understanding of the relationship between Bitcoin futures and the spot price of Bitcoin. In March, judges overseeing the case also urged the SEC to provide a clear explanation of this relationship.

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