BlockFi Files For A Spot Bitcoin ETF in Addition to A Futures ETF

Meanwhile, Bitcoin’s breakout is the signal of the start of a final push-up for its Q4 rally “before the crypto market shows more pronounced consolidation into next year,” as per Fundstrat.

Crypto lender BlockFi has thrown its hat in for the approval of a physically-backed Bitcoin exchange-traded fund (ETF).

The BlockFi NB Bitcoin ETF fund is a joint venture between the lender and an affiliate of Neuberger Berman Group LLC, according to a Monday filing with the Securities and Exchange Commission (SEC). BlockFi will be serving as the custodian.

BlockFi NB Bitcoin ETF would offer shares reflecting the spot value of the leading cryptocurrency held by the trust. These shares issued will trade on the New York Stock Exchange (NYSE) and provide direct exposure to BTC.

“Trust will not purchase or sell bitcoin directly, although the Trust may direct the Custodian to sell bitcoin to pay certain expenses.”

Besides spot bitcoin ETF, BlockFi has also filed to offer bitcoin futures ETF. Last month, the company filed for exposure to only futures contracts traded on the CME.

Towards the end of October, the SEC approved the first BItcoin ETF. ProShares was the first one to launch a bitcoin-linked ETF for US investors.

“Until Gensler shows some evolution mentally, this thing is on ice with the other 20 or so of them,” said Eric Balchunas, a senior ETF analyst with Bloomberg Intelligence. “I don’t think the SEC can be pressured.”

Bitcoin meanwhile rallied to hit a new all-time high at $68,660 on Tuesday, bringing its year-to-date gains to more than 130%.

According to Juthica Chou, Head of OTC Options Trading for crypto exchange Kraken, the approval for the first crypto-related ETFs last month cannot be underestimated as a major driver for the bitcoin rally as “it massively de-risked bitcoin and this space in general.”

The positive sign for the market currently is that there are no major signals for heightened funding rates, or open interest, which are telltale signs of an increasing buildup of leverage, which can suggest euphoria.

“This breakout in Bitcoin might signal the start of a final push-up for the fourth quarter before the crypto market shows more pronounced consolidation into next year,” Fundstrat said in a technical-strategy report Monday. “Strength in Bitcoin, Ethereum, and many other altcoins looks likely in the weeks to come.”

The sliding real yields in the US reflecting inflation concerns can also be a boon for Bitcoin in quarter four as investors see it as a hedge against inflation. Additionally, the Biden administration also passed the trillion-dollar infrastructure bill, which could be another tailwind for already surging prices.

Inflation hedges are “in demand with crypto leading,” said Chris Weston, head of research at Pepperstone Financial Pty, adding that “crypto is where the fast money is at.”

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