The Winklevoss Bitcoin Trust exchange traded fund (ETF) filed with the Securities Exchange Commission to sell one million shares under the symbol COIN on the Nasdaq exchange on December 30, with an IPO price amounting to $20.09 per share.
According to the filing, “the investment objective of the Trust is for the Shares to reflect the performance of the price of Bitcoins, as measured by Winkdex, less the expenses of the Trust’s operations.”
“The Shares are intended to constitute a cost-effective and convenient means of gaining investment exposure to bitcoins” states the prospectus. “Although the Shares will not be the exact equivalent of a direct investment in bitcoins, they provide investors with an alternative that allows a level of participation in bitcoin markets through the securities market.”
The bitcoin exchange-traded fund was founded by Tyler and Cameron Winklevoss and is sponsored by Math-Based Asset Services LLC. Thw Winklevoss hope the ETF will help to take bitcoin into the mainstream and will contribute to its widespread adoption.
The latest amendment comes 18 months after the initial filing in July 2013. The investors will need to wait until they can acquire the shares, as the launch date was not announced.
In an interview to etf.com, the Winklevoss brothers explained the investment thesis for a bitcoin ETF: “There are investors and funds that would like to gain exposure to this asset class, but may be unable or unwilling to hold bitcoin directly, or may not want to buy bitcoins from an unregulated foreign bitcoin exchange.
Investors historically have chosen to offload the friction of directly buying and securing assets such as gold for a reasonable fee. We believe investors will behave the same with regard to bitcoin. Also, since the ETF will be listed on the Nasdaq, investors will be able to trade their shares in the ETF like they would any other stock in a public company.”
“A bitcoin ETF would also appeal to investors who understand the risks and would like to gain exposure to bitcoin as an asset class; and investors who invest in gold or other commodity ETFs,” the brothers added.
The offering will enable investors to enter the bitcoin market without having a deep understanding of how it works. Besides, it will facilitate further adoption of the cryptocurrency.
Despite the high price volatility, the past year has been good for bitcoin, with a large number of new companies and merchants accepting the virtual currency.