Crypto-related ETF Withdrawn by Reality Shares Trust, Following SEC's Request

  • Reality Shares Trust told to withdraw its crypto-related ETF proposal by the SEC.
  • Proposal has been withdrawn, as VanEck-SolidX re-submit bitcoin ETF application.

The US Securities and Exchange Commission (SEC) recently requested the withdrawal of a cryptocurrency-related exchange-traded-fund (ETF) application - which was submitted by Reality Shares ETF Trust.

In an official letter published by the American securities regulator (on February 12th), the SEC clarified that the withdrawal was “at the request of the Staff of the US Securities and Exchange Commission. No securities have been sold in connection with the offering of the Fund.”

Launched by Blockforce Capital, the Reality Shares ETF Trust had initially submitted an application for an ETF (on February 11th) that proposed a portfolio comprising of bitcoin (BTC) futures contracts and more traditional sovereign debt instruments. Following the SEC’s request, Reality Shares has withdrawn its ETF filing.

Reality Shares' ETF Involved Bitcoin Futures

As mentioned in Reality Shares’ application, the proposed ETF was developed to “provide investment exposure to global currencies, both fiat and virtual currencies [cryptocurrencies], that have been widely adopted for use [as a store-of-value (SoV), international remittance, foreign-exchange (FX) trading] throughout the world.”

In its ETF application, Reality Shares Trust had proposed a bitcoin futures contract based on investments made by a wholly owned Cayman Islands-headquartered subsidiary. As noted in the proposal, the cash-settled BTC futures began trading (in December 2017) on the Chicago Mercantile Exchange (CME) and the Chicago Board Options Exchange (Cboe)

Earlier this month, another crypto-related ETF was jointly proposed by Sabretooth Advisors, an investment consultancy and AdvisorShares, a US-based investment management company. The ETF proposed by the companies has been designed to track stocks of traditional tech firms, in addition to the performance of blockchain and cloud computing businesses. According to its designers, the new ETF was developed to allow investors to make strategic investments in emerging technologies.

Bitcoin ETF "Only A Question Of When"

On January 30th 2019, Gabor Gurbacs, the digital asset strategy head at VanEck, announced that his firm along with the Cboe and SolidX had resubmitted (after withdrawing it earlier) an application to the SEC - which requested to allow the Cboe BZX Exchange to list shares of a bitcoin ETF.

Explaining why the initial bitcoin ETF application was withdrawn, Jan van Eck, the CEO of VanEck, said that the companies had been discussing the rule change with the SEC, however their talks ended due the US government shutdown. In order to avoid a potential rejection due to the government’s offices being closed, the proposal had been temporarily withdrawn.

Although a crypto ETF has not yet been approved, Ric Edelman, a 30-year Wall Street veteran, believes a bitcoin ETF will definitely be launched and that “it’s only a question of when.”

Crypto Scammers Responsible for $24 Million in Bitcoin Theft Through First Half of 2020: Report

Michael LaVere
  • New Whale Alert report shows crypto scammers have raked in $24 million in bitcoin through the first six months of 2020.
  • One scammer leveraged YouTube advertising to steal $130k in BTC per day. 

Crypto monitoring service Whale Alert has published a report showing that crypto scammers are responsible for $24 million in bitcoin theft through the first half of the year, including the exploitation of YouTube advertising. 

According to the report “Chasing Crypto Criminals” published July 10, cyber-thieves are finding easy prey in the form of bitcoin and other crypto-asset investors. Whale Alert summarized its exhaustive reviews of hundreds of websites and thousands of reports of theft as “crypto crime pays. A lot.” 

Whale Alert claimed there was little risk involved for crypto-based criminals, despite the massive economic impact being imposed on victims. The report confirmed at least $38 million in bitcoin alone being stolen via scams over the past four years, excluding the use of Ponzi schemes. 

The report reads, 

Some of the most successful scams made over $130,000 in a single day with nothing more than a one page website, a bitcoin address and a decent amount of YouTube advertising.

Whale Alert outlined another scam which brought in $1.5 million over six months through promoting a fake cryptocurrency exchange. The report claims the advertisement took victims to an “amateurish website riddled with spelling errors,” before tricking users into depositing their funds. 

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