WisdomTree, a prominent provider of exchange-traded funds (ETFs), has filed an application seeking approval for the launch of the WisdomTree Bitcoin Trust, to be listed on the Cboe BZX Exchange. This filing comes in the wake of BlackRock's recent application for a spot bitcoin ETF, signaling the increasing interest and recognition of bitcoin within the traditional finance space.
In their filing, WisdomTree outlined their investment objective of gaining exposure to the price of bitcoin while considering the expenses and liabilities associated with the ETF’s operations. WisdomTree intends to value the shares daily based on the CF Bitcoin US Settlement Price, which aggregates trade flow from major bitcoin spot exchanges.
WisdomTree's approach involves conducting "in-kind" transactions with Authorized Participants, enabling them to deliver or facilitate the delivery of bitcoin to the Trust's custodian, U.S. Bank, National Association. Although the name indicates a trust, both WisdomTree’s filing and BlackRock’s filings function as spot ETFs, which is explained further here.
While the Securities and Exchange Commission (SEC) has rejected previous applications for spot Bitcoin ETFs, it has approved Bitcoin futures ETFs. The filings by BlackRock and WisdomTree reflect the industry's push to provide investors with regulated options for participating in the bitcoin market, albeit at the cost of properties exclusive to sovereign bitcoin usage.
The consecutive filings by BlackRock and WisdomTree highlight the increasing recognition of Bitcoin's potential in traditional finance. By applying for spot ETFs, these asset management giants are acknowledging the demand for regulated investment vehicles in the space. The filings may pave the way for broader adoption and a new wave of institutional investors entering the bitcoin market.
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