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German Financial Group to Launch Crypto Index Funds for Institutional and Retail Investors

Iconiq Funds, the asset management arm of Germany-based Iconiq Holding — the team behind the ICO and token sale accelerator program Iconiq Lab — is launching a series of digital asset index funds beginning in Q4 2018, the company announced on Aug. 17, 2018. Investment into crypto assets will become available through traditional and regulated financial vehicles, such as exchange-traded funds (ETFs) and exchange-traded notes (ETNs).

The first digital asset index fund is planned to be launched under Maltese jurisdiction as a Professional Investor Fund (PIF). It is currently under review by Malta Financial Services Authority (MFSA).

The company claims the “diversified exposure to the digital assets market” as a key selling point for this new series of instruments. An investment fund essentially hides the intricacies of crypto assets from its participant, offering participation in a selected group of tokens. An investor expects that, even if some tokens of the group won’t perform well, the growth of others will compensate for it.

Iconiq Funds says the company will offer its financial products under the supervision of a governmental watchdog — such as MFSA for Malta. The team explains that, for many conservative investors, the lack of regulatory oversight was a key reason to avoid exposure to crypto assets.  

Maximilian Lautenschläger, Iconiq Holding’s managing partner, believes that such investment vehicles could help bring new capital to the crypto industry from the traditional financial markets. “Iconiq’s aim is to make ICOs and crypto investments accessible to institutional investors, family offices and retail investors. Only through such regulated vehicles can we open the doors for the trillions of capital from institutional markets to enter crypto.” Lautenschläger said, according to the announcement.

Later, Iconiq Funds also plans to offer other financial products suited for traditional investors’ demands, such as crypto index exchange-traded funds (ETFs) and notes (ETNs) in 2019.

Digital asset management token

The company says that Iconiq Funds is not merely a traditional asset management firm that started trading in crypto. It is, rather, a part of a larger, community-driven ecosystem that Iconiq Holding has built around its own token, ICNQ — initially released by Iconiq Lab. The ICNQ token functions as a “decentralized VC club membership instrument.” According to Iconiq Funds, its holders receive access to presales of companies graduating Iconiq Lab’s token sale accelerator program. It can also be used as a voucher instrument for payments within the asset management ecosystem created by Iconiq.

“We have successfully positioned the ICNQ token as the token for digital asset management,” said Iconiq Holdings CEO Patrick Lowry. “ICNQ tokens can now be redeemed in our ecosystem for products and services provided by Iconiq Holding companies, including by our digital asset index funds to pay asset management fees to the fund manager, Iconiq Funds. We are excited to add this new value-driver to the ICNQ economy, with many more to come for the benefit of our community.”

According to the internal memo Cointelegraph had access to, Iconiq Holding will be selling up to 10 million remaining ICNQ tokens, with a public token sale taking place on the Gibraltar Blockchain Exchange Grid in October 2018. The ICNQ token will then be traded on Gibraltar Blockchain Exchange after the sale, with more exchanges to come.

Iconiq says it plans to capitalize on opening the crypto marketplace to a completely different, and much more powerful class of investors, which may bring “a tectonic change” to the crypto market. Also, it hopes the ICNQ token itself will have the potential to become a kind of derivative instrument that would reflect the influx of the virtually unlimited capital from the outside world of traditional finance into the much smaller crypto ecosystem.

Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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SEC Faces Thursday Deadline for ProShares Bitcoin ETF Decision

Less than a month after delaying a decision on a bitcoin-based exchange-traded fund (ETF), the U.S. Securities and Exchange Commission (SEC) is poised to approve or disapprove another pair of proposed ETFs. 

Officials at the U.S. securities regulator are set to make a decision on the ProShares Bitcoin ETF and the ProShares Short Bitcoin ETF by Thursday, August 23. Unlike this month’s earlier decision to push an approval for the Cboe’s VanEck/SolidX bitcoin ETF, this rule change proposal – filed by ProShares in conjunction with NYSE Arca – cannot be delayed any further under the regulator’s rules.

The ProShares ETF proposals – initially submitted to the SEC last December – are underpinned by bitcoin futures contracts, rather than any physical holdings of bitcoin itself. In other words, the ETF’s value will be determined by the bitcoin futures contracts trading on CME or the Cboe Futures Exchange, according to the original filing.

ProShares originally proposed the futures-based ETFs in September 2017, but noted at the time that the futures market was young and “there can be no assurance that an active trading market for bitcoin futures contracts will develop or be maintained,” according to the filing.

The ProShares Trust previously asked the SEC to withdraw a proposed rule change filed on Dec. 19, 2017 which outlined the ProShares Bitcoin and Short Bitcoin ETFs, as well as the ProShares Bitcoin Futures/Equity Strategy ETF and the ProShares Bitcoin/Blockchain Strategy ETF.

The withdrawal request came after the SEC pushed back against a number of ETF proposals, citing concerns about bitcoin’s volatility at the time. Direxion Shares, VanEck and First Trust Advisors also withdrew a number of similar bitcoin ETF proposals at the time.

However, the SEC later announced it was considering the futures-pinned proposals at the end of January.

To date, the regulator has only denied or delayed bitcoin ETF proposals, with the latest denial coming last month when it rejected a proposal filed by Gemini founders and long-time bitcoin investors Cameron and Tyler Winklevoss.

The proposal had already been rejected in the spring of 2017, but the Bats BZX Exchange, which submitted the proposal, filed an appeal that was later heard by SEC commissioners. 

Miniatures image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Is This The Beginning of Another Bitcoin (BTC) Bull Run?

$6,900 per Bitcoin (BTC) is the current magic number when you ask any seasoned Crypto-trader in the crypto-verse. This is because they believe that once this resistance level is broken by the King of Crypto, we could be seeing BTC values get to a new zone of between $7,600 and $8,000. BTC is currently trading at $6,717 and up 3.34% in the last 24 hours. If its current momentum continues, we could be breaking the $6,900 ceiling very soon.

Several technical analysis experts have done a good job of analyzing the general direction of the price of Bitcoin in the coming months. But technical analysis goes hand in hand with current events that affect the crypto-markets.

Bitcoin ETF Factor

The general mood and feel from crypto-enthusiasts, is that the SEC will approve the Bitcoin ETFs filing by the CBOE. This is due to the fact that previous ETFs were filed during a period when the rest of the world had not shown signs of regulating the industry. At the moment we have the following countries that have passed laws and/or expressing their will to do so: Malta, South Korea, Japan, Canada, Germany, Thailand, Philippines, just to name a few.

This means that the SEC has seen the global progress of crypto adoption as an investment option and will approve the Bitcoin ETFs. The exact date of an SEC decision is not known, but many believe it will be in August.

BlackRock effect

Just yesterday, the news of the BlackRock investment firm exploring blockchain and cryptocurrencies, caused a spike in the price of Bitcoin (BTC). The value of BTC rose from the levels of $6,200 to those of $6,600 in less than 24 hours. The momentum is still there for BTC is now valued at $6,717.

Other institutional investors

The institutional investors are slowly trickling in to invest in the crypto markets. Coinbase has even introduced its Custody service to securely store the digital assets of high net individuals and the said institutional investors.

One good example of the entry of institutional investors, is the declaration of the Swiss based stock exchange of SIX that they will be creating a crypto-trading platform.

Coinbase effect

The Coinbase cryptocurrency exchange has just received the go-ahead to become a government-licensed broker-dealer platform in the United States. This means the exchange can now list digital assets that are classified as ICO tokens. More investors in the United States will now be able to invest in the numerous ICO tokens available, further boosting the volume of the entire crypto markets. Perhaps this is a new avenue for XRP to be listed on the exchange?

In conclusion, the technical analysis of Bitcoin (BTC) had indicated the King of Crypto had been over-sold last week and a rise in value was imminent. The additional news of BlackRock, Coinbase and Bitcoin ETFs might be the news needed to confirm a new Bitcoin Bull Run in the second half of 2018.

Disclaimer: This article is not meant to give financial advice. It is an opinion piece. The opinion herein should be taken as is. Please carry out your own research before investing in any of the numerous cryptocurrencies available.

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Wall Street Vet Brian Kelly Launches Blockchain ETF

Investment manager Brian Kelly is launching a new blockchain startup-based exchange-traded-fund (ETF), he announced Wednesday.

Working in partnership with REX Shares founder Gregg King, Kelly will actively manage a portfolio of roughly 30 companies actively using blockchain technology and matching one of four general criteria, he told CoinDesk. The fund will support firms from the seed stage onward.

He told CoinDesk:

“When I look at the investment landscape, to me blockchain and cryptocurrencies are a once-in-a-lifetime investment opportunity … if I look at every other asset class, to me the most attractive investment is blockchain and cryptocurrency. The growth is explosive [and] the potential is enormous.”

The four criteria, or “pillars,” include enterprise blockchain, or companies using the technology to streamline existing business processes; “Wall Street disruptors,” that is, services changing how securities are traded (such as Overstock.com’s tZero exchange); mining focused entities; and exchange firms and startups creating a decentralized internet, he said.

Further, the fund will evolve over time, Kelly said, noting that “this is an active ETF [so] we’ll be able to add companies to the space.”

While right now the fund may be invested in some enterprise companies, he believes that “over time we might become 100 percent pure play,” or entirely invested in blockchain-specific startups.

That said, the ETF will not be invested in any cryptocurrencies directly, he added – rather, it would be invested in companies with regulated security offerings.

The fund will be open to anyone who has a U.S. brokerage account, he noted, including investors who reside outside the country. A person does not have to be an accredited investor to participate.

Kelly cited the progress companies have made in developing blockchain technology over the last year as the reason for the ETF, saying that firms were “finally getting some revenue from blockchain and cryptocurrency. Even a year ago you had a few who were doing it, but they didn’t have significant revenue streams.”

Now, with some companies even receiving bank financing, Kelly expressed confidence that he could “put together a diversified portfolio.”

Neither is Kelly worried about the volatility seen in cryptocurrency markets. Although his ETF will be invested in companies working with various crypto assets, he said:

“With all investments obviously there’s risk, and the volatility of bitcoin versus equities can change, historically bitcoin has been volatile. That being said we don’t know what the future holds – as more people and more investments come into cryptocurrencies those potentially could actually become less volatile.”

Greg King, Brian Kelly image courtesy Hod Klein

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Another Blockchain ETF Has Launched

An exchange-traded fund focused on companies that are working with blockchain or are eyeing applications of the tech has launched today.

Innovation Shares LLC’s NextGen Protocol ETF (ticker symbol: KOIN) went live on the NYSE Arca exchange, as previously announced in statements from earlier this week.

As of press time, price data via though NYSE shows that trading has begun. The information, as of 9:42 a.m. EST, shows a volume of 100 and a price of $24.94 per share.

The firm backing the ETF said it is deploying artificial intelligence in a bid to track and include notable companies, with an emphasis on stocks that have a “current or future economic interest in blockchain technology.”

Matt Markiewicz, Innovation Shares’ managing director, said in a statement:

“Our proprietary patent-pending AI based process allows us to better capture a full range of publicly traded companies that are developing, investing in and utilizing this new protocol.”

Exchange Traded Concepts, an ETF provider, is acting as the advisor for the fund.

The Innovation Shares launch represents the latest instance of an investment product aimed at taking advantage of the interest – and hype – around the technology.

As CoinDesk previously reported, the first blockchain-based ETFs were launched on both Nasdaq and the NYSE Arca, respectively, earlier this month. Those developments came months after the fall of 2017 saw a flurry of filings from ETFs firms, including from those that have since gone live on the market.

Demand among traditional investors has also led, in recent months, to the creation of futures contracts dedicated to bitcoin markets. Whether they lead to the launch of a long-sought-after bitcoin ETF – as some have suggested – remains to be seen.

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The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.

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The First Blockchain ETFs Have Launched on the Nasdaq Exchange

Reality Shares Advisors and Amplify Trust ETF launched the first blockchain-based exchange-traded funds (ETFs) on Nasdaq today.

Both funds went live on Nasdaq’s exchange at 9:30 a.m. EST. Reality Shares’ Nasdaq NextGen Economy ETF (BLCN) opened at $24.20, while Amplify’s Transformational Data Sharing ETF (BLOK) started closer to $20.

Both ETFs will exclusively invest in blockchain-based companies, according to a previous CoinDesk article. When the prospectuses were first filed in November 2017, the companies noted that investing in blockchain startups could be risky, as there are few regulations on the technology and companies may not necessarily turn a profit.

However, the prospectuses also noted that the funds would only invest in companies with a market capitalization of greater than $200 million and which had a six-month daily trading average of at least $1 million.

Reality Shares has developed an index with Nasdaq to track blockchain startups which the ETF will utilize, said Kian Salehizadeh, an analyst with Reality Shares. Nasdaq’s blockchain research team forms part of the index’s contributors. The index is further supported by an algorithm developed by Reality Shares.

Salehizadeh continued:

“We wanted to do a blockchain technology-related ETF, so not another bitcoin fund but something that takes advantage of the underlying ecosystem. So we developed a methodology in-house which measures seven quantitative factors and we run those factors on a universe of publicly traded [data].”

He further told CoinDesk that the company’s ETF originally contained the word “blockchain” in its name, but the U.S. Securities and Exchange Commission (SEC) had his company remove the term.

While the SEC has not formally issued an approval of the ETFs, the lack of a formal disapproval means the ETFs were automatically approved under current law, Salehizadeh explained. At present, the SEC has 75 days to issue a disapproval or objection to an ETF filing. If no such disapproval or objection is stated, the funds can be listed.

Companies have previously filed for blockchain-based ETFs, but none had made it as far as listing prior to Reality Shares and Amplify Trust. Most recently, Horizons ETFs Management filed for a blockchain ETF in November.

Amplify Trust ETF had not responded to a request for comment at press time.

Stock exchange image via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

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New Bitcoin ETF Filings Follow CBOE Futures Debut

New public filings suggest that the launch of new bitcoin futures products in the U.S. has renewed a push to launch exchange-traded funds (ETFs) tied to the nascent market for these derivatives.

According to the Securities and Exchange Commission’s EDGAR system, new applications have been received for the VanEck Vectors Bitcoin Strategy ETF, as well as both the REX Bitcoin Strategy ETF and REX Short Bitcoin Strategy ETF, have been submitted to the agency. Connecticut-based REX’s filing is dated Dec. 8, whereas VanEck’s is dated Dec. 11, the records show.

As previously reported, filings from these firms were withdrawn earlier this year after the SEC raised questions about the timing of the launches.

“[SEC] Staff expressed the view that it is the Commission’s policy to not review a registration statement for a fund where the underlying instruments in which the fund intends to primarily invest are not yet available,” VanEck assistant general counsel Matthew Babinsky wrote in a letter in late September. REX went on to make a similar statement the following month.

The timing is notable, given that Chicago-based CBOE launched its initial bitcoin futures products on Sunday. That opening was marked by a near-simultaneous spike in the price of bitcoin and loss of connectivity on the exchange operator’s website.

Subsequent reports show that CBOE’s self-imposed circuit-breakers – which pause trading during big price swings – have activated in the hours since the futures trading went live.

According to data from CNBC, the price of CBOE’s January futures contract is trading at $17,790 as of 10:14 a.m. EST, on a volume of 3,011 following the start of trading.

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The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.