Cryptocurrency Q&A
What's the difference between Bitcoin ETFs and depositary receipts?
What's the difference between Bitcoin ETFs and depositary receipts?
BlockchainEmpiress
Tue Jul 09 2024
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5 answers
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Could you elaborate on the fundamental differences between Bitcoin ETFs and depositary receipts? Are they both investment vehicles for crypto enthusiasts, but with distinct operational mechanisms? Does an ETF offer investors more diversified exposure to Bitcoin and potentially lower volatility compared to a depositary receipt that directly represents a specific amount of Bitcoin? Also, how do the regulatory frameworks surrounding these two instruments vary, and what implications do they have for investors seeking to gain access to the Bitcoin market?
5 answers
Chloe_martinez_explorer
Wed Jul 10 2024
According to Mehta's statement to Bloomberg, depositary receipts for bitcoin would confer direct ownership of the cryptocurrency, unlike shares in bitcoin ETFs which are redeemable for cash.
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CryptoMaven
Wed Jul 10 2024
Anchorage Digital Bank National Association will be tasked with providing custody of the underlying bitcoin for the depositary receipts, ensuring the safety and security of investors' holdings.
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Tommaso
Wed Jul 10 2024
The news was reported earlier by Bloomberg, highlighting the difference in ownership structure between the two investment vehicles.
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Federico
Wed Jul 10 2024
Depositary receipts, as a means of investing in bitcoin, would allow investors to hold a direct stake in the digital asset.
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isabella_taylor_activist
Wed Jul 10 2024
In contrast, shares in bitcoin ETFs would represent an indirect investment, with redemption typically in cash rather than bitcoin itself.
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