Toronto Firm Evolve Applies for Bitcoin-Based ETF in Canada

An exchange-traded-fund (ETF) management firm, Evolve Funds, has announced the company is seeking regulatory approval for a Canadian bitcoin-based ETF.

Also read: Markets Update: Bitcoin Price Consolidates After Last Week’s Volatility

Evolve Funds Aims to Introduce Canada’s First Bitcoin ETF

The Toronto-based firm, Evolve Funds, has revealed the fund management business is currently in the process of filing a preliminary prospectus for a bitcoin ETF in Canada. The company is attempting to provide a variety of other ETFs that cover investments like cybersecurity and classic cars. Evolve Cyber Security Index ETF (CYBR) currently trades on the Toronto Stock Exchange (TSX) while the classic cars fund is pending approval alongside the bitcoin ETF prospectus.

The Evolve bitcoin ETF will be called “BITS,” and aims to give mainstream investors exposure to bitcoin if Canadian regulators decide to approve the fund. Evolve explains that BITS will derive its value from the performance of bitcoin through investments based off of the CFE Bitcoin Futures Index. According to Evolve, there will be a management fee for 0.80 percent of the ETF’s net asset value (NAV).

“Accessing bitcoin is not easy for many – it is a very complicated and expensive process as investors are currently unable to trade them in a regular brokerage account,” explains the  President & CEO of Evolve Funds, Raj Lala.

An ETF tied to the price of bitcoin could be a simpler way for investors to participate in its growth.

Bitcoin Effectively Marries Currency With Technology

The company started last summer and many of the ETFs it creates cover niche markets that traditional ETF management firms don’t usually handle. At the moment, the firm is waiting for the Canadian Securities Administrators (CSA) to list four new funds on TSX including the bitcoin ETF. However, Canada’s provincial and securities regulators are currently busy researching initial coin offerings and drafting legal framework for token sales. Evolve’s founder Mr. Lala is still optimistic about the CSA approving the fund and believes bitcoin is the future of money.                

“Bitcoin effectively marries currency with technology,” Mr. Lala details. “Bitcoin is an online currency that can be sent and received by anyone in the world, relying on computers to control the transfer and creation of money without human intervention.”

It’s the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. As more and more of the world goes digital, usage of cryptocurrencies could increase significantly in the coming years.

Canada May Get a Bitcoin-Based ETF Before the U.S.

Evolve also details that BITS investors can purchase both hedged and unhedged shares. The startup says if the ETF is approved, Evolve Funds, will be the primary “promoter, manager, trustee and portfolio manager of BITS.”

At the moment in the U.S., the Securities and Exchange Commission has denied bitcoin exchange-traded funds, but investors can still purchase Grayscale’s GBTC and soon Ledger X’s bitcoin options. Presently there are a few cryptocurrency ETFs in Europe, and now Canada might see a bitcoin-based ETF before U.S. management companies gain approval. Additionally, last week the first registration of a Canadian management firm operating a bitcoin investment fund was approved by the British Columbia Securities Commission.  

What do you think about Canada introducing a bitcoin-based ETF in the country? Let us know what you think in the comments below.   

Images via Shutterstock and Evolve Funds logo. 

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