Bitcoin futures ETFs on the market tomorrow
|Slavomír Kaňuk|source|8889x
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Bitcoin futures ETFs on the market tomorrow

Bitcoin Futures ETFs traded on the NYSE represent a major milestone in the history of the king of cryptocurrencies. The official name is the ProShares Bitcoin Strategy ETF and trading under the BITO ticker will begin tomorrow. The importance of this moment is also emphasized by the fact that this is the first approved ETF after 8 years of applications from various companies. Nevertheless, experts refer to this only as the start of the integration of cryptocurrencies into the world of traditional finances on the US market.

ETF stands for "Exchange-Traded Fund". ETFs buy and package various underlying assets (or groups of them) and then sell them in the form of shares that anyone can trade on available markets. In general, they are designed to track the price of the underlying asset.


However, the new bitcoin ETFs differ from the described form and the difference is in the word "Futures". ProShares does not buy the cryptocurrency Bitcoin directly, but rather contracts linked to its future price. The price of the ProShares ETF will thus partially follow the price of Bitcoin, but not as a "pure" spot ETF would. Approval of the spot ETF is currently probably a matter of months and, according to some statements, is not certain at all.

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You can get new ETFs relatively easily and just have an account with a broker such as Fidelity or Robinhood. On these platforms, you will look for the BITO ticker and buy "shares" in the same way as, for example, Facebook, Square or Tesla shares. However, the key question remains for whom such purchase will be advantageous in times when it is relatively easy to buy and keep cryptocurrencies independently. You can currently do this on dozens of platforms from around the world, and in addition, you will save on fees and buy at a price that is close to the current market price. Therefore, we often come across the statements that this approval comes extremely late and that the market, in this direction, has overtaken regulators.


Despite the aforementioned sceptical view, we can certainly say that the new ETFs will open the door to new (probably mainly institutional) capital that could help the greatest cryptocurrency to achieve the new ATH. Buying cryptocurrencies directly is still a technically challenging issue for many people, thinking they can't handle it. In addition, purchasing through a regulated entity is almost a necessity for large amounts of institutional capital.

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The limit of the new ATH is currently within reach, and Bitcoin has reached $ 61,000, thanks to pending ETF approval. However, analysts warn us against a scenario in which traders bought before the approval of the ETF and will currently try to collect their profits, which could send the price sharply down. However, the opposite scenario, in which we exceed the previous historical maximum, is at least as relevant. The well-known analyst PlanB in his S2F model assumes that we will look at 6-digit Bitcoin prices this year.


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