US SEC Approves BTC Futures Fund to Offer Shares to Institutional Investors

Published at: Dec. 6, 2019

Bitcoin (BTC) futures-focused NYDIG Bitcoin Strategy Fund has procured approval from the United States Securities and Exchange Commission (SEC), entitling it with the right to offer its shares to institutional investors.

According to an SEC filing that came into effect on Dec. 2, the New York Digital Investment Group LLC (NYDIG) is now authorized to offer its shares to institutional investors, including registered investment advisers, their clients, and other eligible investors. For those who intend to invest in the shares, the fund does not put forward a minimum investment requirement.

Cash-settled BTC futures

The fund describes itself as “a non-diversified, closed-end management investment company that continuously offers its shares,” with the objective of achieving capital appreciation by investing in BTC futures contracts. The proposed maximum offering price per share is $10, while its initial capital is $25 million.

Detailing its investment strategy, the company noted that the fund will only invest in cash-settled BTC futures traded on commodity exchanges registered with the U.S. Commodity Futures Trading Commission.

More licenses from New York regulators

In mid-November, the New York State Department of Financial Services (NYDFS) granted a BitLicense to NYDIG Execution, a subsidiary of the NYDIG. Through the license, the firm is permitted to offer crypto custodial and trade execution services in the jurisdiction of New York state.

NYDIG is allowed to operate as a crypto custodian for five cryptocurrencies; Bitcoin, Bitcoin Cash (BCH), Ethereum (ETH), XRP and Litecoin (LTC).

Earlier in December, California-based financial firm SoFi acquired a BitLicense from the NYDFS. The firm is now authorized to support a total of six digital assets including BTC, ETH, BCH, Ethereum Classic (ETC), LTC and Stellar (XLM).

At the time, NYDFS Superintendent Linda Lacewell noted the authority’s commitment to fostering innovation in New York’s crypto ecosystem, stating, "The Department's approval of SoFi's virtual currency and money transmitter licenses provides consumers with more choices in a continuously evolving global financial services marketplace."

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