Cryptocurrency asset manager Bitwise plans to publicly trade its Bitcoin Fund on over-the-counter (OTC) desks and secondary markets
Bitwise Asset Management announced yesterday that it had filed a Form 211 with the U.S. Financial Industry Regulatory Authority (FINRA). The cryptocurrency asset management company wants to publicly trade its Bitcoin Fund shares on over-the-counter (OTC) desks and secondary markets.
The firm hopes to obtain regulatory approval from the financial regulator to publicly list the Bitwise Bitcoin Fund on OTC markets. If approved, the Bitwise Bitcoin Fund (BBF) will trade on OTCQX Best Market. However, Bitwise is yet to choose a ticker for the Bitcoin Fund.
Bitwise President Teddy Fusaro said the firm is excited for the Bitwise Bitcoin Fund to follow the same path as the Bitwise 10 Crypto Index Fund (OTCQX: BITW), which recently gained regulatory approval. “We have been managing this fund since 2018, offering investors a cost-effective, convenient, and secure means of gaining investment exposure to bitcoin, and are excited to potentially see shares of the fund quoted on OTCQX,” he added.
The Bitwise Bitcoin Fund has been opened for private placements since December 2018, but only accredited investors are allowed access to the fund. The Bitwise Bitcoin Fund charges a 1.5% expense ratio, including custody, tax, accounting and management fees.
Interest from professional investors is rising
Matt Hougan, Bitwise’s chief investment officer, highlighted that the firm is making this move due to professional investors’ rising interest in accessing Bitcoin. These investors want to access Bitcoin as a tool to hedge their portfolio and protect their wealth against rising inflation.
“Financial advisors, in particular, are taking note of the large allocations that hedge funds, institutions, insurance companies, and traditional asset managers are making to Bitcoin”, Hougan said. The financial advisors now believe it is time to allocate some of their funds to Bitcoin, he added.
If cleared, the Bitwise Bitcoin Fund will compete with Grayscale, the cryptocurrency space’s leading fund manager. Grayscale has numerous trusts currently selling on OTC markets, granting financial institutions exposure to Bitcoin and a few other cryptocurrencies. Grayscale’s funds are available on OTC markets, making them available to larger audiences, while Bitwise has been limited to private holdings.