A subsidiary of one of the frontrunners in the race to launch a crypto Exchange-Traded Fund (ETF) will seek reliable Bitcoin price info by charting the prices large and institutional investors pay.
MV Index Solutions (MVIS), a company owned by investment management firm VanEck, has begun charting the price of Bitcoin among some of the biggest so-called over-the-counter (OTC) traders of cryptocurrency. The OTC Spot Index, which will be listed under the ticker MVBTCO, will chart the price across the Circle Trade, Genesis Trading and Cumberland desks – and appears to be a positioning moved designed to court approval among SEC commissioners for its future plans.
OTC trading allows large investors and institutions to put the buying and selling of cryptocurrency into the hands of a private network of traders, and bypass public crypto exchanges. Thus, the monitoring of Bitcoin paid in such transactions potentially offers institutions a price discovery tool for Bitcoin that is not subject to the problems repeatedly reported with public trading platforms such as manipulation and volatility.
The MVBTCO will be the 24th digital asset index managed by MVIS, and will – according to Thomasa Kettner, managing director of the firm – provide a “reliable benchmark for their trades or potential investment products.”
According to Gabor Gurbacs, director of Digital Asset Strategies at VanEck/MVIS, MVBTCO will provide “greater transparency and price discovery” for institutional investors, and “may pave the way for institutionally oriented products, such as ETFs, as well as provide further tools to institutional investors to execute institutional size trades at transparent prices on the OTC markets.”
VanECK, alongside FinTech firm SolidX, appear to be one of organisations wit the best chance of getting a cryptocurrency based Exchange-Trade Fund (ETF) approved by the Securities Exchange Commission in the near future. It attempt to be listed on the CBOE BZX Equities Exchange is currently on commissioners’ desks, with a decision having been deferred in September while it collects and analyse public response to the proposal.
One of the issues that the SEC has consistently quoted as being problematic in the approval process is generating reliable pricing information across largely unregulated exchanges. So this index, is quite obviously a move towards mitigating such concerns and allaying fears that main-street investors could become embroiled in issues among some of the less-savoury environs of crypto.