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Crescent Crypto files application for new crypto-based ETF with SEC

Crescent Crypto Index Services LLC has filed an application with the  US Securites and Exchange Commission (SEC) for a cryptocurrency-backed exchange-traded fund (ETF).

A Crypto-Backed ETF

The firm, which is a subsidiary of Crescent Crypto Asset Management LLC, a financial services provider that manages a suite of indices, offerings and customized investment programs for high-net-worth individuals (HNWIs) and family offices, is looking to track the performance of a “market capitalization-weighted portfolio mainly composed of Bitcoin (BTC) and Ethereum (ETH).”

The ETF is being sponsored by United States Commodity Funds LLC (USCF), a company that specializes in managing exchange-traded commodity funds, which will be the primarily investor of the ETF fund that will be named the USCF Crescent Crypto Index Fund (“XBET”).

Christopher Matta, Co-Founder of Crescent, commented on the sponsorship:

“Crescent’s mission is to create innovative investment solutions that make cryptocurrencies accessible to mainstream investors. USCF has a robust ETP infrastructure and a history of pioneering alternative asset funds. This makes them the ideal partner to accomplish that mission through a differentiated product, which offers better diversification than Bitcoin alone.”

The application states that USCF Crescent Crypto Index Fund will be an exchange-traded fund and investors who plan to buy or sell shares of the fund in question will be able to do it through USCF’s  brokers and will be subject to brokerage commission fees. The shares are expected to be traded on the New York Stock Exchange (NYSE) under the ticker symbol previously mentioned and will be traded like any other publicly traded security, during trading days at bid and ask prices.

USCF first began operations in 2005 and has a long history managing exchange-traded funds. Since it was founded, the firm has been regulated by the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA) under the Commodity Exchange Act (CEA).

The Waiting List

Besides Crescent Crypto’s ETF application, there are currently two other proposals sitting on the SEC’s desk.

One was filed early this year by Bitwise Asset Management that was set to address all the regulatory concerns which prevented their first application from being approved. The Bitwise Bitcoin ETF Trust would track Bitwise Bitcoin Total Return Index, which measures the value of Bitcoin and any major hard forks. If approved, it will be listed on NYSE Arca, an exchange where both stocks and options are traded.

The second one was proposed by VanEck / SolidX with the help of the Cboe BZX exchange, which was submitted in February this year. If approved, it will allow Cboe to list the share of the ETF trust on its platform, bringing more liquidity to the cryptocurrency market.  

Although one of the main differences between the Crescent Crypto’s ETF application and the other two is that it involves ether, it remains to be seen whether the SEC will approve any of the proposed crypto ETFs. Jay Clayton, the Chairman of the SEC, has previously stated that Bitcoin is more like a currency than anything else and also thinks Ethereum does not qualify as a security. Thus, an approval of one or all applications might be coming soon.

Crypto Insider reached out to the board of directors at Crescent Crypto Asset Management LLC to get their insights about the proposed ETF, but has yet to receive an answer.

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