Everyone Wants A Bitcoin ETF Approved Right? But Could The SEC Approve A Negative-Fee ETF?
Could The U.S. SEC Approve A Negative-Fee Bitcoin ETF?
The cryptocurrency market has been waiting for the approval of a Bitcoin (BTC) exchange-traded fund (ETF) that would allow new investors to enter the space. During the last years, several proposals have been rejected by the U.S. Securities and Exchange Commission (SEC). Now, there is another innovative proposal for an ETF that is waiting for approval.
Could A Negative-Fee Bitcoin ETF Be Approved?
At the moment, there is a low-cost ETF that will be reducing trading fees for investors. And indeed, it will not only be reducing the fees, but it will be paying users to purchase shares. This ETF is known as Salt Low truBeta US Market ETF and it is the first of its kind. At the same time, it will also be the first-ever negative fee ETF in the market.
The intention is to raise $100 million by paying investors to place their funds in the ETF. The first $100 million bought into the fund would not be charged anything and add 0.05% of their initial investments.
The negative-fee ETF is finally here: Salt Financial filed on Tuesday to launch an ETF that will actually pay investors for investing adding 0.05% 🙉
🎠It will track an index of roughly 100 low-volatility stocks$LSLT $FIS $SCHW $XLF $GS $MS $STT $BLKRhttps://t.co/u1j2Yk4olA pic.twitter.com/mzjxK3CI5b
— alpe pinnazzo (@alpepinnazzo) March 13, 2019
The new ETF would track 100 low volatility stocks, allowing investors to hedge against volatility in the markets. Now, the application is waiting for approval for the SEC.
During a conversation with CNBC, Tom Lydon, proprietor of EFTrends.com, commented:
“Is it a marketing ploy? Maybe, but it’s probably a great one because all the money is going into low-cost ETFs. Getting through the gatekeeper is key. When you look under the hood, it’s actually a great strategy. When you look at other low-volatility smart beta strategies, it really is good, and that will help get it attention.”
This new fee scheme could attract individuals that are not interested in investing in these socks. If the ETF reaches $100 million, it will be possible for the EF to be available on more platforms such as those operated by Morgan Stanley and also Merril Lynch.
There are also many Bitcoin ETF applications that are waiting for approval from the SEC. One of them is the one that was presented by Bitwise Asset Management. There are others such as VanEck that filed its application after the application presented in 2018 was withdrawn due to the government shutdown.