Canada Set To Launch Third Bitcoin ETF
Regulators in Canada have approved a third Bitcoin ETF. The CI Galaxy Bitcoin ETF (BTCX) has been given the green light and is set to launch today on the Toronto Stock Exchange (TSX).
Canadian investment management firm CI Global Asset Management (CI GAM) will manage the ETF, and is a subsidiary of CI Financial Corp., a global asset management with approximately $183 billion AUM.
Galaxy Digital Capital Management, a subsidiary of Mike Novogratz’ Galaxy Digital, will act as the sub-advisor for the Bitcoin ETF, and it confirmed the approval yesterday.
According to the announcement, ‘[The CI Galaxy Bitcoin ETF (BTCX)] is designed to provide investors with a convenient way to gain exposure to Bitcoin through an institutional-quality fund platform.’
The BTCX Will Be Backed By Physical Bitcoins
According to the announcement, the BTCX ETF will invest directly in physical bitcoins and will use the Bloomberg Galaxy Bitcoin Index to measure performance of BTC to USD.
CI GAM also plans to merge its existing CI Galaxy Bitcoin Fund into the ETF, which is approximately $172 million.
Speaking of the ETF, the CEO of CI Financial Kurt MacAlpine said both Galaxy Digital’s and GI CAM’s expertise in alternative trading products ensures the BTCX will stand out among its rivals.
‘The CI Galaxy Bitcoin ETF offers investors a secure and convenient means of holding Bitcoin in their portfolio. I believe our ETF stands out based on its highly competitive price point and CI and Galaxy’s extensive capabilities and track record in managing alternative investments and digital assets.’
Canada Leading The Way When It Comes To Bitcoin ETFs
Canada is certainly not waiting for its southern neighbour when it comes to the race for a Bitcoin ETF. Regulators up there have approved three Bitcoin ETFs in less than a month.
The first approval was the Purpose Bitcoin ETF, which was the biggest traded ETF of any such product on its first day, trading $165 million in volume, and has grown to be worth over $540m in the two weeks since launch.
The success of the Bitcoin ETFs in Canada might also be connected with Grayscale’s dramatic fall in value, after the biggest traded fund slipped into negative territory last week.
For only the second time in its history, the gap between The Grayscale Bitcoin Fund (GBTC) share price and the implied price of the underlying Bitcoin has collapsed to a 12% discount from a 35% premium late last year.
No doubt the Bitcoin price has been relatively bearish the last couple of weeks, which always affects the Grayscale premium, but a drop deep into negative territory at the same time the Bitocin ETFs are flourishing is quite telling.
Canada’s Bitcoin ETFs might be affecting GBTC, which might end up merging into an ETF anyway, but are they affecting the US SEC into approving an ETF anytime soon? They wouldn’t want to give Canada too big a start, would they?