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Barry Silbert has announced that his Bitcoin Investment Trust went public on OTCQX exchange, thus becoming the first publicly traded bitcoin fund.
Bitcoin Investment Trust Founder Barry Silbert has informed on Twitter that his company has gone public on the OTC Markets Group marketplace, with shares could start trading next week.
It was recently announced that the BIT received the permit of FINRA (Financial Industry Regulatory Authority) to become the first publicly traded digital currency fund. The trust was officially approved for listing on OTCQX exchange under the GBTC symbol on Thursday.
“Over the past three or four months, a handful of banks have started to experiment,” said Silbert. “Some of them are experimenting around trading, some around using the blockchain for settlement, and some are interested in deploying capital as investors.”
Grayscale Investments, which is a part of Silbert’s Digital Currency Group, will sponsor and operate the fund.
Each BIT’s share is valued at nearly one-tenth of a bitcoin. As the price of shares will fluctuate with the cryptocurrency’s exchange rate, the investors will be able to profit from the reductions in the price of bitcoin without the need of buying and keeping it.
The BIT is invested in digital currency and its value is derived from the bitcoin’s value. The fund is a great opportunity for investors who are not trading bitcoin as currency because of its high price fluctuations.
As the BIT has not got an approval from Securities and Exchange Commission (SEC) for share registration, the trust can’t be officially considered as an Exchange Traded Fund (ETF) and can’t be traded on the NYSE or Nasdaq.
Meantime, other funds are seeking to complete SEC registration process. Thus, the Winklevoss brothers plan to make their Bitcoin Trust ETF available for investors on Nasdaq after obtaining the organization’s approval, although the exact date of launch is unknown. The trust is planned to be traded under the symbol COIN. Besides, the brothers intend to open a regulated bitcoin exchange, called Gemeni.
“The hope within the bitcoin community is that BIT and future publicly traded bitcoin investment vehicles will improve liquidity and thus help smooth out some of the price volatility that has plagued bitcoin in its early years.
The fact that BIT is also now a regulated entity should help calm the (justified) fears of many prospective bitcoin investors. A more stable bitcoin market is seen as being a necessary pre-condition for widespread adoption as a payment vehicle,” PandoDaily reports.
According to the Grayscale website, the virtual currencies are expected to revolutionize the financial system, although it won’t happen quickly.
“At Grayscale, we believe investors deserve an established, trusted, and accountable partner that can help them navigate the gray areas of digital currency investing. That’s why we are building transparent, familiar investment products that facilitate access to this burgeoning asset class, and provide the springboard to invest in the new digital currency-powered ‘internet of money,” the website states.