Bitwise bullish on pure Bitcoin ETF after dropping futures filing

Bitwise Asset Management has withdrew its application to create a Bitcoin (BTC), futures-based exchange traded fund (ETF), amid numerous similar products being launched in the United States.

The firm dropped its futures-linked ETF but is still bullish about a spot Bitcoin ETF that tracks Bitcoin directly. Matt Hougan, Bitwise chief investment officer, announced this on Nov. 10.

Hougan stated that Bitwise’s spot file remains intact, and that the company will continue to work towards launching such a product here in the United States.

“A spot Bitcoin ETF is what most investors want. We believe that it is possible. Bitwise will pursue this goal and will seek other ways to assist investors in accessing the amazing opportunities in crypto.

CIO stressed that the first Bitcoin ETF application ever filed was a spot based ETF created by Tyler Winklevoss and Cameron Winklevoss, founders of Gemini crypto exchange. The application was filed in 2013 and denied by the U.S Securities and Exchange Commission (SEC). He said that many people have been involved in this project for years.

Hougan said that “any ETF” was a “big step”, referring to the multiple Bitcoin futures ETFs that received approval from the SEC and began trading in October. Bitwise chose to withdraw its application for a variety of reasons.

According to Bitwise analysis, the Bitcoin futures ETF contango would result in investors paying between 5% and 10% annually if the spot price is higher than the futures one.

Hougan also pointed out that BTC futures ETFs reportedly took up “all available capacities at futures commission brokers.” However, this will eventually ease, but it is an additional expense. What is the result? He said that costs are added to existing costs and adds complexity.”

Related: BlockFi files for physically backed Bitcoin ETF

The CIO stated that “none” of these means futures-based ETFs were bad, and that products such as the ProShares Bitcoin Strategy Strategy ETF or the Valkyrie Bitcoin Strategy Strategy ETF are “thoughtful”.

Cointelegraph reported that Bitwise filed for a spot Bitcoin ETF mid-October. The company plans to list the product on NYSE Arca, an electronic securities exchange. This application was filed just one month after Bitwise had filed for the Bitwise Bitcoin Strategy ETF back in September.