Canadian firm Ninepoint Partners have launched a Bitcoin Trust Fund after raising nearly $180 million in private investment. The Canadian private investment fund is following in the footsteps of the popular fund manager Grayscale. The firm has listed its shares on Toronto Stock Exchange which would be backed by Bitcoin it holds with New-York based Gemini.
Bitcoin Exchange Traded Fund (ETF) is one of the most controversial topics as regulators continue to sideline the demand suggesting the market is not big enough for an ETF. However, institutions have found a way around these regulatory hurdles by investing in private trust funds such as Grayscale who launch publically traded share which is backed by bitcoin trust.
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Ninepoint is trying to emulate the highly successful Grayscale model of offering bitcoin-backed tradable shares and earning a commission on the traded stock. The Candian Bitcoin Trust would be available at 0.7% with no lockup period, unlike its American counterpart who is known for closing its shares from time to time.
Grayscale’s premium has been a controversial topic because of the premium prices, and many believe SEC would eventually come for them and shut them once the market is ready for a real ETF.
Bitcoin ETF Faces Regulatory Woes
The US Securities and Exchange Commission has rejected all the ETF proposals till now, but the exit of former SEC chief Jay Clayton made many believe that the rising bitcoin price and overall crypto market cap could help launch the first Bitcoin ETF very soon. However, the recent comments made by Treasury Secretary Janet Yellen regarding bitcoin and the proposed regulations around crypto wallets as well as the StableAct has made many rethink their early enthusiasm.
Ark Investment Management CEO Cathie Wood recently conveyed that a Bitcoin ETF would not be possible until the market cap is about $2 Trillion.