Analysis Today TheBitTimes.com

Financial services firm First Trust submitted the Bitcoin buffer filing ETF to the United States Securities and Exchange Commission on Dec. 14.  The filing, Form N1, outlines the firm’s intention to introduce a new Bitcoin-linked product named the First Trust Bitcoin Buffer ETF. Exposure to Bitcoin’s performance According to the filing, the newly proposed fund will mirror the positive price returns of the Grayscale Bitcoin Trust or another exchange-traded product (ETP), offering exposure to Bitcoin’s performance before factoring in fees and expenses. First Trust just filed for a #Bitcoin Buffer ETF. These types of funds protect against a set % of downside loss with capped upside. Expect to see other entrants in the space with unique differentiated strategies offering Bitcoin exposure over coming weeks. h/t @VildanaHajric pic.twitter.com/1qiWF53dM0 — James Seyffart (@JSeyff) December 14, 2023 Differing from a spot Bitcoin ETF, which directly tracks Bitcoi...

The United States SEC is showing a clear preference for a cash redemption model in spot Bitcoin ETFs. Notably, Invesco and Galaxy Digital have recently updated their filings to align with this model, indicating a broader industry shift. This development was highlighted on Dec. 14 by finance lawyer Scott Johnsson. The updated S-1 filings of these firms now show a commitment to cash transactions to create and redeem ETF shares. This move signals a significant pivot in handling Bitcoin ETFs, contrasting with the in-kind redemption model proposed by firms like BlackRock. I think everyone is gonna have to bend the knee to cash creates and redeems. https://t.co/1z9HknHyAG — James Seyffart (@JSeyff) December 13, 2023 The distinction between these two models lies in their operational mechanics. In a cash creation model, participants deposit cash equivalent to the net asset value of the created ETF units, which the fund then uses to purchase assets like Bitcoin (BTC). On the oth...