The VanEck Bitcoin ETF – What Are The Chances?

Conor Maloney

November 17, 2018

We’ve discussed the possibility of a Bitcoin ETF in the past and the doors such a tool could open (and close) for the crypto space.

An ETF is an Exchange Traded Fund and essentially allows traders to get in on the price action of Bitcoin without actually owning any and without having to deal with cryptocurrency exchange KYC and signup, cryptocurrency wallets, and all of the niche elements of crypto trading that cause concern and confusion among regular stock traders.

Not everyone wants to use Bitcoin as some kind of world currency – as a commodity, it trades billions of dollars every day, and many traders want to get in on the action but don’t want to have to trust sketchy exchanges or risk losing their private keys with no insurance or recourse in recovering their funds.

All The Price Action, None of The Fraud

Exchange Traded Funds introduce the traditional safety protocols that are already in place for stock trading, and indeed, a Bitcoin ETF would be traded on the stock market as opposed to crypto or mutual fund exchanges.

The ETF is a security representing the price of Bitcoin which is actually bought and held by the fund and professionally managed. Users won’t have Bitcoin, but they won’t have to worry about the inherent risks of the space either and it’s estimated that a huge amount of new money could enter the space if an ETF is released. While the securities bought by ETF investors aren’t Bitcoin, the Bitcoin the fund will buy certainly is.

Why VanEck?

VanEck is an investment management firm headquartered in New York and founded in the mid-fifties.

If you’ve followed the Bitcoin ETF efforts of the past you probably know that the Winklevoss twins of the Gemini exchange have tried many times to secure a Bitcoin ETF license and have been rejected by the SEC every time on grounds such as concern over the legality of overseas BTC handling.

Why would VanEck succeed where the twins have failed?

Well, as the director of Digital Asset Strategy at VanEck/MVIS, Gabor Gurbacs, pointed out, Van Eck has done this before. Not with cryptocurrency, mind you – with gold.

“VanEck has a history of building international stock and gold investing, in the U.S. and abroad,” Gurbacs said in an interview with Bitcoin Magazine.

VanEck was behind the first ever gold equity mutual fund which, the VanEck International Investors Fund which was launched in 1968 and is still in operation. At the time, the gold market cap was $200 million and the price of gold was $35 an ounce. Now it’s over $1,200 an ounce and the market cap is well over $7 trillion, something Gurbacs believes VanEck’s investment vehicle is partially responsible for.

While not everyone in Bitcoin even agrees with the idea of an ETF, with crypto-godfather Andreas Antonopoulos among the critics, there’s no doubt about it – a Bitcoin ETF would significantly increase the chances of a bull run and a far greater market cap than has been seen to date in crypto. While the true believers may not like it, the traders are all for it, and wherever you stand on the subject, there’s no little doubt in anyone’s mind that a Bitcoin ETF is inevitable.

The question is now – who will get there first?

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