Bitcoin ETF Approved: What Did You Miss? | Author: Kemal M. Lepschoq, LL.M. | January 2024

By Crypto Gloom On Jan 12, 2024

The SEC has finally approved a Bitcoin fund, balancing innovation with the need for “investor protection”. The first trading day is today (January 11, 2024).

The world of finance is on the cusp of a remarkable evolution: Bitcoin-based exchange-traded product (ETP) As of January 10, 2024. Latest release from the Securities and Exchange Commission (SEC) (No.34-99306) is It is a long-awaited decision that will shape the cryptocurrency investment landscape in the mainstream market.

The report outlines the SEC’s review of rule change proposals submitted by major exchanges, including: NYSE Arca Inc., Nasdaq Stock Market LLC and Cboe BZX Exchange Inc.. The offer aims to list and trade shares of the following financial instruments: Grayscale Bitcoin Trust and Bitwise Bitcoin ETFespecially.

not Exchange Traded Fund (ETF) It is a type of investment fund and exchange-traded product. They are traded on stock exchanges. ETFs are similar to mutual funds in many ways. The only difference is that ETFs are traded on stock exchanges throughout the day, while mutual funds are traded based on price at the end of the trading day. ETFs are attractive as investments because of their low costs, tax efficiency, and stock-like characteristics.

Imagine you have a fruit basket. This basket contains a variety of fruits, including apples, bananas, oranges, and grapes. Instead of buying each type of fruit separately, you buy the whole basket, so you get a little bit of everything in one purchase.

Now let’s relate this to ETFs.

Fruit Basket = ETF: The fruit basket represents ETFs. Just as a basket contains a variety of fruits, an ETF contains a mix of different investments, such as stocks of different companies, bonds, or gold. This mix is expertly managed to ensure diversity and balance.
Buy individual fruits = Buy individual stocks: Instead of buying each fruit individually (like buying individual shares of another company), you buy a basket (ETF) that already contains a variety of fruits (stocks or other investments).