As the price and popularity of Bitcoin increases, we are seeing a lot of new ETFs popping up. More and more investment companies are filing for their own Bitcoin EFTs. Investing in these will give anyone easy access to the benefits of the rising prices of Bitcoin without investing in them directly. Slowly, we are seeing that the market is getting saturated with similar trusts. And adding to the saturation, SkyBridge and First Trust have filed for their ETF under the SEC. The applications were filed by the companies two days back on Friday.
SkyBridge and First Trust ETF
SkyBridge and First Trust are working together on the BTC EFT they are planning to launch. The ETF will be called the “First Trust Sky Bridge Bitcoin ETF Trust”. In this, First Trust will act as an advisory body for the ETF, while SkyBridge will act as the sub-advisor. The shares of the ETF are going to be available on public trading platforms through NYSE Arca. As of now, even SEC has 5 pending approvals to accept or reject the ETFs.
While there is scepticism in general whether the funds will be accepted or not by the SEC, the founder of SkyBridge is quite optimistic they will. In fact, he thinks that the US market is ready for Bitcoin funds. The fact that the interest in Bitcoin is only going up is a clear indication that the arrival of new Bitcoin ETF funds is not going to stop.
What are Bitcoin ETFs?
The idea of a Bitcoin EFT is it’s easy to invest method. A person who wants to invest in Bitcoin but doesn’t want the hassle can invest in one such fund through a normal exchange. These funds are directly pegged to the price of Bitcoin and are more or less an accurate representation of its price. For example: If you invest in a fund whose share price is $57 when the price of Bitcoin is $57,000 means that owning 1000 shares of the fund is approximately equal to owning a Bitcoin. And now, when the price of Bitcoin goes up, so does the share prices and your profits.
There are a lot of advantages and disadvantages to EFTs, and it is completely up to an investor to choose what’s more important to him. Benefits like regulated market, better tex efficiency, diversified portfolio and more. On the other hand, the disadvantages are high management fees, lack of Bitcoin ownership, Inaccuracxy in price depiction and others.
I hope that the idea of what a Bitcoin EFT is and its advantages and disadvantages are clear. What are your thoughts on the idea of Bitcoin ETFs? And will you consider investing in one? Let us know in the comments below. Also, if you found our content informative, do like it and share it with your friends.