VanEck Files for Futures Bitcoin ETF After SEC Hints at Path to Approval

Investment firm VanEck has filed for a Bitcoin futures exchange-traded fund (ETF)—a week after SEC Chair Gary Gensler hinted that the Commission may be inclined to approve such products. 

The New York-based firm’s ETF application was filed yesterday to the SEC. The company, which manages $63 billion in assets, hopes to expose would-be investors to contracts that bet on the price of Bitcoin going up and down. 

VanEck’s director of digital asset strategies, Gabor Gurbacs, told Decrypt that the firm believes a futures ETF would have an “easier path to approval.”

It’s the second time the firm has applied for a futures ETF. But it isn’t what the firm is primarily after. Only last week Gurbacs told Decrypt that a “physical exposure Bitcoin ETF is more efficient than futures-based fund structures.” The firm is also one of many companies awaiting SEC approval for a Bitcoin ETF that is backed by physical BTC, as opposed to futures contracts. 

An ETF is an investment tool that allows people to buy shares that represent an asset, like gold, real estate, or Bitcoin. Bitcoin and other crypto ETFs allow investors to invest in the digital asset without having to worry about actually buying and securely storing it. Such ETFs around the world—including in Canada—have been massively popular. 

A Bitcoin ETF does not exist in the U.S. yet because the SEC has been reluctant to approve one, citing concerns over price manipulation in the crypto market. 

And last week, SEC Chair Gary Gensler said that he would only be open to approving a Bitcoin ETF under strict rules and not necessarily one that provides direct Bitcoin exposure. Gensler said that he “particularly looked forward to” the SEC’s review of “ETFs limited to these CME-traded Bitcoin futures.” CME, short for the Chicago Mercantile Exchange, is a derivatives market that is regulated by the CFTC.

Market experts responded to Gensler’s comments by saying that investors want direct Bitcoin exposure—and not a futures ETF. 

VanEck, it appears, is willing to play the odds and has now applied for both.

“VanEck was first to file for a futures-based Bitcoin ETF. Currently the futures markets are regulated, hence there is an easier path for approval,” Gurbacs said.

He added, however, that spot products—which track the actual price of Bitcoin, rather than futures contracts—“are better designed.” This is because, according to ETF experts who spoke with Decrypt, spot-based products are more liquid than derivatives and less costly for both the issuers and investors.