VanEck BTC Futures ETF Ends Its First Day With $9.6M AUM

The VanEck BTC Futures ETF ended its first day with $9.6 million in assets under management while the Bitcoin price dipped below $60,000 as we can see more in our Bitcoin news today.

It was quite the volatile day for Bitcoin and an even worse day for VanEck’s ETF compared to its competitors. The VanEck BTC Futures ETF ended its first day on a lower note than its competitors while the bitcoin price dipped below $60,000 for the first time in two weeks and then recovered slightly to reach 59,966 by the time traditional markets closed.

VanEck’s XBTF saw 38,398 shares traded on the first day that ended the day at $59.73 per share which is below the $60 opening. The ETF had about $9.6 million in assets under management according to the company and it only meant a bittersweet debut for the company that had its spot market BTC ETF already denied by the SEC after the regulator cited lingering concerns about manipulation and fraud on the crypto market. The application is still waiting on a decision from the regulator since 2017. Kyle DaCruz who is a director of digital asset products at VanEck explained:

“Obviously, we were disappointed to hear about the decision on the spot physical product and we still continue to view that as the superior product. However, in light of that decision, we felt it important–and frankly we’re excited–to bring to market Bitcoin-linked exposure to investors in a regulated exchange-traded fund.”

Spot prices have to do with the asset’s real-time value and futures contracts are agreements to purchase the asset later at a locked-in price. DaCruz added that VanEck does plan to keep working ahead and bring a spot product to the market but he can’t really tell when that will happen. For now, its BTC Futures ETF has two main competitors. The Proshares Bitcoin Strategy is the first bitcoin futures ETF that gained SEC approval and accumulated a record of $1.1 billion during the first days of trading and remained steady at $1.05 billion. The Valkyrie Bitcoin Strategy launched three days later and it has about $500 million under management.

DaCruz added that the VanEck ETF has two main advantages which are low fees of 0.65 basis points compared to the 0.95 of BITO and BTF as well as its C-Corp structure which allows it to carry forward losses. This means that if the ETF completes the year with losses, they can be carried forward and deducted from the year’s profits which means that investors can use other past losses to reduce the taxes on their future gains. He was really careful to note that it doesn’t necessarily make a C-corp the right structure for the ETFs worldwide but most are structured as RICs or regulated investment companies. VanEck Believes it will be a great idea for all products tied to BTC because of the crypto’s volatility.