Brazil launches Latin America’s first Bitcoin ETF

[Chewy_fox]

The Brazilian Securities and Exchange Commission (CVM) authorized the launch of the exchange-trade fund (ETF) for bitcoin and other cryptocurrencies, introduced by crypto asset manager Hashdex. It is the first investment fund of this type to be born in Latin America.

Samir Kerbage, CTO of Hashdex, made the announcement during a virtual conference he participated in on Wednesday, March 17. Information published on the company’s website details that the product tracks the Nasdaq Crypto Index (NCI), developed by Nasdaq and Hashdex, and is presented as an option for institutional investors to gain exposure to the cryptocurrency market.

The Hashdex ETF replicates the composition of the NCI which is based on 6 crypto assets, Bitcoin (BTC), Ether (ETH), the native cryptocurrency of the Ethereum network, Litecoin (LTC), Chainlink (LINK), Bitcoin Cash (BCH) and Stellar (XLM).

The ETF offers several entry points, as investors can gain exposure by investing in the Hashdex Nasdaq Crypto Index through various investment platforms linked to the Sao Paolo Stock Exchange or the Bermuda Stock Exchange (BSX), the Stock Exchange. from Bermuda.

Brazilian investors will be able to access through the group of operators managed in the country by Hashdex, including XP, BTG, Rico, Órama and Genial. Also non-US organizations can enter through operators in BSX. While, United States entities will only be able to invest through private placement, as explained on the website.

According to some digital media, the minimum collection to make the ETF offer viable is 250 million reais (USD 45 million). It will be traded with the HASH11 ticker.

The cryptocurrency manager Hashdex raises an option for traditional organizations to diversify their portfolio by accessing cryptocurrencies. Source: Hashdex/hashdex.com.br

Bitcoin ETFs are exchange-traded funds that track the value of the queen cryptocurrency and are traded on traditional markets rather than on cryptocurrency exchanges.

With these investment alternatives, the price of a share in the exchange fund fluctuates with the price of bitcoin (BTC). If the value of the crypto asset increases, so does the ETF, and vice versa. Instead of being listed on a cryptocurrency exchange, the ETF is listed on a stock exchange. Under this formula, investors do not buy BTC directly, but rather a share that follows the price of this asset.

A new wave of institutional interest in bitcoin

A new wave of institutional interest has fueled bitcoin recently and as institutional interest in cryptocurrencies grows other market players are also considering launching their own ETFs. Such is the case of Grayscale, which is seeking experts in exchange-traded funds, making it clear that it would soon seek approval from the United States Securities and Exchange Commission (SEC) to offer a more exclusive investment instrument.

However, until now the SEC is still evaluating the entry of these assets to its bag. Several are waiting for approval, one of them is Van Eck, whose application is still pending.

In other parts of the world like North America, various bitcoin ETFs have already been cleared by regulators. As Cryptoreportage reported, in Canada, the investment management company CI Global Asset Manager is the third firm to be listed on the Toronto Stock Exchange with these products.

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