Digital currency investing and cryptocurrency asset management firm Grayscale Investments is planning to convert its flagship fund into a spot exchange-traded fund (ETF) next week, NewsBTC reported.

  • The Bitcoin-futures ETF will make cryptocurrencies more accessible to retail investors and will utilize derivative contracts traded on the Chicago Mercantile Exchange (CME).
  • Should it be approved, the Grayscale spot Bitcoin ETF will be backed by actual Bitcoins, rather than derivatives that track the digital token’s price. Grayscale already has a number of Bitcoin holdings.
  • Researchers warned of the possible Contango phenomenon, which happens when futures prices are above the expected future spot price. This would lead investors to lose out on potential gains due to the expiration of futures contracts over spot prices.

The Securities and Exchange Commission (SEC) last week approved ProShares’s Bitcoin futures ETF, the first in the country. It will trade on the New York Stock Exchange early next week. BTC is up 0.19%.