What is a bitcoin futures ETF?

A Bitcoin Futures ETF is a type of Exchange Traded Fund that doesn't hold Bitcoin directly. Instead, it invests in Bitcoin futures contracts, which are agreements to buy or sell Bitcoin at a predetermined price on a set future date. This allows investors to speculate on the future price movements of Bitcoin without owning the cryptocurrency itself.

What is a bitcoin spot ETF?

In a futures ETF, traders don't own any bitcoin. Instead, they only need to enter an agreement about the price of bitcoin on a certain date in the future. Whereas a Bitcoin Spot ETF requires investors to actually buy Bitcoin, which they can later sell as they wish.

Are Futures a safe option for bitcoin exchange-traded funds?

SEC Chair Gary Gensler is on the record stating that given the novel character of cryptocurrency, relying on the proven and highly regulated futures market is a much safer approach for Bitcoin exchange-traded funds. Futures are an agreement between two parties to sell a particular asset at a future date.

Are bitcoin ETFs regulated?

Regulation of Bitcoin is a murky subject. The level of regulation varies from country to country and even from one state to another. The IRS tends to treat Bitcoin and other crypto as property while the Commodity Futures Trading Commission (CFTC) treats it as a commodity. Bitcoin Futures ETFs are regulated by the CFTC.