SEC Will Not Allow Leveraged Bitcoin ETFs (For Now) By

SEC Will Not Allow Leveraged Bitcoin ETFs (For Now) By
SEC Will Not Allow Leveraged Bitcoin ETFs (For Now) By

© Reuters.

By Laura Sánchez – Not all joy for ETFs. As the market is talking about, the US Securities and Exchange Commission (SEC) would have rejected one, or possibly two, recent applications for Bitcoin ETFs.

Just one day after Valkyrie applied for a leveraged ETF and Direxion applied for a reverse fund, the SEC appears to have vetoed them both.

On October 28, Bloomberg’s senior ETF analyst Eric Balchunas referred to an alert stating that the SEC had shelved Valkyrie’s leveraged fund. He added that the measure is likely to apply to the reverse fund’s request as well.

The SEC has indicated that it will allow only unlevered funds tied to cryptocurrency, at least for now, it collects Financial Times.

On October 26, Direxion, applied for a Bitcoin ETF that would allow speculators to buy futures that are short in price of. On the same day, Valkyrie applied for a leveraged BTC futures ETF that would have offered 1.25x exposure to the asset.

The Direxion product is invested purely in futures, however the Valkyrie product would have had futures, swaps, options and forwards.

Another Dow Jones alert reported that the SEC only seems interested in direct futures products at this time, funds that buy contracts from the Chicago Mercantile Exchange (CME).

Nonetheless, applications for Bitcoin ETFs continue to be submitted. This morning, Balchunas reported another 2.

Yesterday, the 2 Bitcoin futures ETFs currently traded in the United States, the ProShares Bitcoin Strategy ETF (NYSE

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