- Investment firm VanEck has recently filed a draft prospectus for a Bitcoin-related mutual fund with a US regulator.
- In the wealth manager’s filing with the Securities & Exchange Commission, VanEck acknowledged the possible risks involved.
- The fund manager has yet to hear a decision from the SEC of its Bitcoin ETF filing that has been delayed twice.
Wealth manager VanEck has filed a prospectus with the United States Securities & Exchange Commission (SEC) to launch the Bitcoin Strategy Fund.
VanEck warns of risks associated with Bitcoin
This new prospectus filed with the securities regulator states that the fund will acquire Bitcoin exchange-traded products and futures.
The fund manager will invest in Bitcoin futures contracts and use the CME CF Bitcoin Reference Rate (BRR) while also investing in pooled investment vehicles that directly and indirectly invest in the leading cryptocurrency.
The new crypto fund, introduced as the investment manager as the “Bitcoin Strategy Fund,” will have its share price fluctuate with the changes in the market value of its portfolio securities.
In addition, VanEck stated that it would not acquire Bitcoin directly due to the risks involved with the cryptocurrency markets. The fund manager said that the fund would not invest in other digital assets directly either. The filing states:
“The value of Bitcoin and, therefore, of the fund’s Bitcoin-related investments could decline rapidly, including to zero. You should be prepared to lose your entire investment.”
The global investment manager filed the registration on June 21, and in addition to the Bitcoin-related investments, the fund will also have significant holdings of cash and fixed-income investments.
VanEck also added that the fund’s risks are not only limited to the bellwether cryptocurrency but also the risks involved with pooled investment vehicles, target exposure and rebalancing, borrowing and leverage, tracking errors, credit issues and interest rate discrepancies.
The fund manager has yet to receive an outcome on the decision from the SEC of its exchange-traded fund (ETF) registration. Earlier this month, the securities regulator delayed making a decision on the VanEck Bitcoin Trust for the second time.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Ripple on-chain metrics show bullish signs amidst legal struggle with SEC, XRP eyes recovery
Ripple made a comeback above $0.48 on Tuesday and hovers above that level in Wednesday’s European session. Ripple on-chain metrics such as transaction volume and Network Realized Profit/Loss have turned bullish, supporting a recovery in the altcoin.
Bitcoin price falls amidst German government transfers, miners activity
Bitcoin (BTC) extends correction on Wednesday and hovers around $61,000 after finding resistance near the $64,000 level on Monday. Recent on-chain data indicates heightened selling activity from Bitcoin miners early in the week.
Crypto Today: Bitcoin erases gains from end of June, Ethereum declines while Ripple holds
Bitcoin wipes out gains from the last week of June and falls below $60,000 on Wednesday. Ethereum and top altcoins ranked by market capitalization erased gains as the inflation outlook worsened. Ripple holds on to recent gains and hovers above $0.48 on Wednesday.
Three reasons why altcoins could shake off losses this week
On-chain data from Santiment shows that altcoins are currently in the opportunity zone, or generating buy signals. The top three altcoins in the buy zone are Basic Attention Token (BAT), Chromia (CHR), and Highstreet (HIGH), per Santiment.
Bitcoin: BTC price correction could end in July, according to seasonal data
Bitcoin (BTC) price appears poised for a decline this week, influenced by slight outflows in US spot ETFs, selling activity among BTC miners, and a combined transfer of 4,690.28 BTC to centralized exchanges by the US and German governments.