The exchange traded fund (ETF) scene is due another shakeup as SolidX Partners files to become the first fund to launch on the New York Stock Exchange (NYSE) – and even feature full insurance.
Also read: ETF Queen Moriarty Takes on SEC for Bitcoin
SolidX ETF Will Be Insured
The SolidX Bitcoin Trust, for which an S-1 registration is today with the US Securities and Exchanges Commission (SEC), will trade under the ticker XBTC.
“The Trust will not be actively managed,” a brief press release issued today continues.
SolidX (sldx.com) itself is a blockchain technology startup active in corporate identity solutions. It last week launched its product, Vida, which CEO Daniel H. Gallancy described to Finance Magnates as “a first of its kind enterprise-grade identity platform using public key infrastructure and built on blockchain technology.”
In 2014, SolidX received $3 million USD in venture capital, originally aiming to give Bitcoin market access to hedge funds and asset managers.
The company’s ETF is set to achieve more than just first place on the traditional stock exchange. Investors will also enjoy full insurance against loss or theft of coins, something conspicuously missing from offerings such as COIN ETF, which is due to launch on the Bats BZX Exchange.
“…[A] loss may be suffered with respect to the Trust’s bitcoin which is not covered by insurance and for which no person is liable in damages,” its S-1 filing states.
By contrast, SolidX writes in today’s filing:
“The Trust will maintain crime, excess crime and excess vault risk insurance coverage underwritten by various insurance carriers. The purpose of the insurance is to protect shareholders against loss or theft of the Trust’s bitcoin. The insurance will cover loss of bitcoin by, among other things, theft, destruction, bitcoin in transit, computer fraud (i.e., hacking attack) and other loss of the private keys that are necessary to access the bitcoin held by the Trust.”
The first Bitcoin ETF to be actively traded, Bitcoin Investment Trust (trading as GBTC), also offers insurance through Xapo, which it uses for all storage of investor funds.
The question of insurance aside, however, SolidX’s potential for legitimacy on the NYSE could well provide Bitcoin with more than a casual boost of trust.
“It does not get any bigger than this,” one Reddit user commented in light of the news. “If this ETF gets approved and successfully launches, then Bitcoin has pretty much reached the endgame of legitimacy in financial terms.”
NYSE indeed is the largest stock exchange by market capitalization, which in May 2015 stood at over $19.5 trillion.
What do you think about the SolidX offering? Let us know your thoughts in the comments section below!
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