Key Points
- The SEC has extended its review period for the listing of 7RCC’s carbon-neutral Bitcoin ETF.
- The Bitcoin ETF will track daily price fluctuations of the cryptocurrency and carbon credit futures.
The United States Securities and Exchange Commission (SEC) has extended its review period for the approval or disapproval of the New York Stock Exchange Arca’s application for the listing of 7RCC’s carbon-neutral spot Bitcoin exchange-traded fund (ETF).
The new deadline for the final decision is now June 24, 2024, a significant delay from the original deadline of May 10, 2024.
The Carbon-Neutral Bitcoin ETF
The ETF is designed to offer investors exposure to Bitcoin, alongside carbon credits to offset the digital asset’s carbon footprint. The ETF would track daily price changes in Bitcoin, as well as carbon credit futures based on the Vinter Bitcoin Carbon Credits Index. Crypto exchange Gemini would act as the custodian of the Bitcoin fund.
The ETF aims to attract institutional investors who require an environmental, social and governance (ESG) compliant investment. It plans to allocate 80% of its assets to Bitcoin and the remaining 20% to financial instruments, such as swaps, tied to carbon credit futures contracts related to emissions allowances.
Carbon Credit Futures
Carbon credit futures are financial derivatives that allow trading based on the anticipated future value of carbon credits. These instruments facilitate financial strategies to manage carbon regulatory risks and support environmentally focused investment strategies.
Since the beginning of the year, the SEC has approved 11 spot Bitcoin ETFs. These ETFs enable direct investment in Bitcoin, providing exposure to Bitcoin’s market movements through a regulated investment product. The next goal for investment managers is options trading on spot Bitcoin ETFs.
The SEC has been postponing a decision on applications submitted by the New York Stock Exchange, Nasdaq and Cboe Global Markets since January.
