SEC is still working things out while Canada has already done it by approving the first and only regulated bitcoin trust fund the status of a Mutual fund that enables accredited investors to make an investment in Bitcoin through their retirement savings plan and tax-free savings accounts among others.
Canada’s first & only regulated Bitcoin fund granted mutual fund status
Canada has left the SEC behind as it approves a Bitcoin Fund and granted it with the mutual fund trust status. According to the official announcement by the First Block Capital Inc., the FBC Bitcoin Trust has become the first and only regulated Bitcoin Trust eligible for accredited investors.
This allows the unit holders to put their units in a self-directed registered account like a tax-free savings account (TFSA) and registered retirement savings plan (RRSP). This trust is available for purchase on NEO Connect under the FBCBT ticker.
In the same manner, as the ETFs are bought and sold FBC Bitcoin Trust is purchased and redeemed by NEO Connect. The platform has removed the 30-day redemption clause and now enables daily settlements.
Sean Clark, the co-founder, and CEO of First Block Capital which is actually the first dedicated and fully registered crypto and blockchain investment company with PM, EMD, and IFM licenses said:
“Since inception, First Block Capital has been committed to providing investors with regulated, titled and auditable exposure to investment vehicles based on blockchain and cryptocurrency. Our team is extremely proud to maintain our market-leading position and will continue to execute our vision of creating a fleet of investible products dedicated to space.”
Making it easy for accredited investors to invest
As per this trust, the qualified investors are allowed the exposure to the Bitcoin but without having to actually acquire, store, and manage the underlying Bitcoin.
Under the Tax Act, if the trust units exceed 150 unit holders within a year of its launch, it is considered a mutual fund trust. The announcement further talks about the Bitcoin trust being the first and only OSC (Ontario Securities Commission) and BCSC (British Columbia Securities Commission) approved product of its kind in the country. This is while offering the exclusive opportunity to hold units of BTC investment in their Retirement Savings Plans (RRSP) and Tax-Free Savings Accounts (TFSA).
Marc van der Chijs, the co-founder and CIO of First Block stated:
“With this accomplishment, we continue to push Canada forward as a world leader in regulated blockchain and cryptocurrency investment vehicles. Our goal is to make investments in the digital currency asset class more accessible and we are one step closer to achieving this goal by allowing unitholders to place units in government-sponsored tax efficient vehicles, and by providing daily liquidity through NEO Connect, a fund distribution platform with a rapidly growing dealer network.”
Moreover, First Block is extremely optimistic as it anticipates a majority of their investors will begin moving the units within the first month itself.
People are excited about this news as one Redditor shared,
“That is a pretty significant development. Obviously only really relevant for Canada, but it does make it less risky for the SEC (for them) to approve an ETF.”
Another one shared,
“Tax-free exposure to Bitcoin gains is a really great step. Hopefully, Canadian banks can further improve their acceptance of Bitcoin. It might be nice to start with NOT locking out accounts found transacting with crypto-currencies. This would help incentivize Canadians to invest in Bitcoin. Of course, any real investor in Bitcoin holds their own keys, rather than just trusting some bankster.”
While “How will the US react if Canada keeps improving its acceptance of Bitcoin to the point where USD$ devalues relative to CAD$?” are contemplating others.