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Invesco Renounces Bitcoin Futures ETF Filing

Invesco has renounced its Bitcoin futures ETF filing hours before ProShares is due to launch a similar product on the New York Stock Exchange.

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Key Takeaways

  • Invesco has withdrawn its application for a Bitcoin futures ETF.
  • Invesco spokesperson said the firm wants to pursue a physically-backed digital asset ETF instead.
  • VanEck’s and Valkyrie’s futures-based Bitcoin ETFs are also likely to begin trading next week.

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Invesco Ltd., a U.S.-based investment management company with over $1.56 trillion in assets under management, has opted to withdraw its Bitcoin futures ETF application. 

Invesco Aims to Pursue Physical Bitcoin ETF

Invesco has renounced its Bitcoin Futures ETF filing. 

The asset management firm was one of the first in line to file for a futures-based Bitcoin ETF in August but has decided to delay the effective date of its Bitcoin Strategy ETF until Oct. 29, 2021. “We have determined not to pursue the launch of a Bitcoin futures ETF in the immediate near-term,” an Invesco spokesperson told Bloomberg. The firm will continue working with Galaxy Digital to offer investors exposure to digital assets, including pursuing a physically-backed digital asset ETF.

The move to temporarily drop out of the race has caught many industry experts off guard, especially given that the SEC had indicated it had no objections with its application. Invesco was due to hear back on whether it could launch the ETF this week. 

The first firm to receive an approval from the SEC was ProShares, an American provider of specialized exchange-traded products with over $53 billion in assets under management. ProShares’ Bitcoin Strategy ETF is set to begin trading on the New York Stock Exchange today under the ticker BITO.

Two other Bitcoin futures ETFs likely to begin trading before the end of the month are VanEck’s and Valkyrie’s Bitcoin Strategy ETFs. The SEC respectively has until Oct. 24 and Oct. 25 to respond to the filings. 

Several firms filed applications with the SEC in August after the agency’s chairman Gary Gensler stated it would likely favor futures-based Bitcoin ETF products over physical-based ones. 

Futures-based ETFs represent a contractual agreement that obligates traders to buy or sell the instrument that tracks the price of the underlying asset (in this case, Bitcoin) at a specific time, quantity, and price in the future, whereby the contracts are typically cash-settled. On the other hand, a physical Bitcoin ETF would represent funds that hold Bitcoin rather than cash-settled contracts. They would give investors exposure to the price of Bitcoin through the shares of the fund trading on traditional stock exchanges.

Judging by Invesco’s latest comments, the firm is no longer interested in launching a futures-based Bitcoin ETF. Instead, it seems to be turning its focus toward securing a physically-backed digital asset ETF. 

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