WisdomTree, a leading provider of exchange-traded funds (ETFs), has filed an application requesting approval to launch the WisdomTree Bitcoin Trust, which will be listed on the Cboe BZX exchange. This filing follows BlackRock’s recent request for a spot bitcoin ETF, signaling the growing interest and recognition of bitcoin in the traditional financial space.
In their filing, WisdomTree outlined their investment objective of gaining exposure to the price of bitcoin while considering the expenses and liabilities associated with ETF operations. WisdomTree intends to value stocks daily based on the US Bitcoin CF settlement price, which aggregates trade flows from major bitcoin spot exchanges.
WisdomTree’s approach is to conduct “in-kind” transactions with Authorized Participants, allowing them to deliver or facilitate the delivery of bitcoin to the Trust’s custodian, US Bank, National Association. Although the name indicates a trust, WisdomTree’s deposit and BlackRock’s deposits operate as spot ETFs, which is explained in more detail here.
While the Securities and Exchange Commission (SEC) has rejected previous applications for spot Bitcoin ETFs, it has approved Bitcoin futures ETFs. The filings by BlackRock and WisdomTree reflect the industry’s desire to provide investors with regulated options to participate in the bitcoin market, albeit at the cost of exclusive properties to the sovereign use of bitcoin.
Back-to-back filings from BlackRock and WisdomTree highlight the growing recognition of Bitcoin’s potential in traditional finance. By applying for spot ETFs, these asset management giants recognize the demand for regulated investment vehicles in the space. The deposits could pave the way for wider adoption and a new wave of institutional investors entering the bitcoin market.