Invesco exec reveals reasons for dropping Bitcoin futures ETF

After dripping a Bitcoin requestBTC) exchange-traded fund (ETF) of futures in October, the US asset manager for 1.6 trillion dollars, Invesco, has revealed the reasons behind the decision.

Anna Paglia, Global Head of ETFs and Indexed Strategies at Invesco, said the main reason for dropping the presentation was that the US Securities and Exchange Commission (SEC) only approved Bitcoin ETFs with 100% exposure to Bitcoin futures.

The Invesco Bitcoin Strategy ETF was ideally designed to be a combination of futures swaps, physical Bitcoin, and private funds in the Bitcoin industry, Paglia. said in a Sunday interview with The Financial Times. Such a composition would help protect investors in the event of a liquidity crisis, he stated, adding:

“We thought CME futures were going to be a very effective portfolio item. We never thought they would be effective when they would be 100% of the product. "

Paglia said that Invesco realized that there are better ways to provide this particular exposure rather than giving investors something they don't need. He also cited concerns related to capacity and liquidity in the futures market.

Invesco originally introduced its Invesco Bitcoin Strategy ETF In early August, it plans to invest its assets in Bitcoin futures and publicly traded products, as well as Bitcoin-linked private investment trusts such as the Grayscale Bitcoin Trust. According to Paglia, Invesco applied for the ETF within 24 hours after SEC Chairman Gary Gensler hinted that the regulator could be open to approve Bitcoin futures ETFs It is listed on the Chicago Mercantile Exchange.

“It was easier to say 'yes' and see how it goes than 'no' and explain the decision. We had to make this difficult decision and take the decision. I would do the same again, ”said Paglia.

Paglia's comments come shortly after Bitwise Asset Management became another company for delete your Bitcoin ETF app in early November despite the launch of Bitcoin futures ETFs like the ProShares Bitcoin Strategy ETF and the Valkyrie Bitcoin Strategy ETF.

Related: SEC Rejects VanEck Spot Bitcoin ETF As BTC Price Falls Below $ 63K

Bitwise chief investment officer Matt Hougan noted that the contango Bitcoin futures ETF, a situation where the futures price is higher than the spot price, could be costly for investors.

Hougan added that the company will continue its efforts to launch a spot Bitcoin ETF in the US, as no such products have been launched since the founders of the Gemini crypto exchange, Cameron and Tyler Winklevoss, first. archived for such a product in 2017.