Home Energy assets Valkyrie Bitcoin Mining Etf to List on Nasdaq; Everything you need to know

Valkyrie Bitcoin Mining Etf to List on Nasdaq; Everything you need to know


Crypto asset management firm Valkyrie’s bitcoin mining exchange-traded fund (ETF) is set to list on the Nasdaq exchange on February 8. The Valkyrie Bitcoin Miners ETF will invest 80% or more of its assets in companies that earn at least half of their profits from bitcoin mining.

In a filing with the U.S. Securities and Exchange Commission (SEC), Valkyrie CEO Leah Wald said, “Increased focus and desire for exposure to bitcoin miners from investors prompted the company to petition the SEC on January 26 to offer the ETF. .

An ETF is a pool of diversified securities that track a particular index, sector or other asset. They are like mutual funds, except they can be bought and sold on the stock exchange.

Why this is a step forward for crypto ETFs and mining companies

Historically, only forward ETFs (an agreement to buy or sell shares of an ETF at an agreed price in the future) have been allowed in the market because spot ETFs have not been approved by the SEC. This is a small but important step towards the future institutional adoption of bitcoin and other cryptocurrencies.

It will also shed light on bitcoin cryptocurrency mining companies which are slowly becoming more popular as the demand for crypto trading has also increased among the general public.

It could also be a valve for other cash ETFs. Valkyrie also has a handful of ETF spots awaiting SEC approval.

All About Bitcoin Mining ETF

This ETF provides exposure to stocks of various bitcoin mining companies already listed on the Nasdaq but with the benefits of ETF investing.

Here’s everything you need to know about the ETF

  • The ETF will be listed on the Nasdaq stock exchange under the symbol “WGMI”.
  • The fund will have 80% exposure to mining companies that derive at least 50% of their profits from bitcoin mining or related activities.
  • The balance portion of the ETF will be directed to companies with significant cryptocurrency assets on their balance sheets.
  • The ETF spend ratio will be 0.75%, which means that for every $100 of ETF securities traders buy, 75 cents will go to Valkyrie, according to a Coindesk report.
  • Some of the biggest mining stocks in the fund will be Argo Blockchain (ARBK), Bitfarms (BITF), Cleanspark (CLSK), Hive Blockchain (HIVE) and Stronghold Digital Mining (SDIG). Their allocation within the fund will vary from 8 to 10%.
  • Valkyrie also said that the fund’s portfolio mining operations use about 77% renewable energy to allay investor concerns about the environmental impact of mining.
  • The Viridi Cleaner Energy Crypto-Mining & Semiconductor (RIGZ) ETF and the Bitwise Crypto Industry Innovators (BITQ) ETF are among other US-listed ETFs with exposure to crypto-mining companies. The sharp drop in bitcoin prices in recent weeks had weighed on the performance of these ETFs. However, with bitcoin now rallying above $44,000, ETFs are gaining momentum.

    Bitcoin mining has been a hot topic for lawmakers and people concerned about the carbon footprint the activity leaves behind. To their credit, bitcoin mining companies have slowly moved to using renewable energy sources. A recent report by the Bitcoin Mining Council (BMC) showed that bitcoin mining is gradually adopting a sustainable pattern of energy use.

    MicroStrategy Founder and CEO Michael Saylor, a key member of the BMC, said, “This quarter, we saw the trend continue with dramatic improvements in the energy efficiency and sustainability of Bitcoin mining in due to advances in semiconductor technology, the rapid expansion of North American mining. , the exodus from China and the global shift towards sustainable energy and modern mining techniques.

    (Edited by : Aditi Gautam)