Gate.io ETF | ETF of all kinds 🎁

If you are curious about what ETFs are, please refer to 'The Birth Story of ETFs 🎉'.

When people usually talk about Bitcoin ETFs, they are talking about ETFs in the US market. However, ETFs exist in a variety of markets. For example, the first Bitcoin ETF was launched on the Canadian stock market. This is called the 'Purpose Bitcoin ETF' and is traded on the Toronto Stock Exchange as a BTCC ticker.

But most attention is focused on the regulation of the US, the world's largest stock market. The US Bitcoin ETF could make Bitcoin a solid investment asset.

There have been several attempts to launch a Bitcoin ETF in the United States. To date, all applications have been rejected by the US Securities and Exchange Commission (SEC).

Why does the US Securities and Exchange Commission keep rejecting applications?

They are rejecting ETF applications, mainly citing the obvious issues of volatility, the unregulated nature of the Bitcoin market, and market manipulation. This may be true to some extent, but it may also be true for many other financial markets where ETFs already exist.

Not only that but during the last bear market, significant financial foundations have been laid for classifying Bitcoin as a major asset class. It would have been very difficult for MicroStrategy to buy billions of dollars worth of Bitcoin years ago. But today, both the infrastructure and liquidity are in place, and we are ready to make these sizable investments.

This continued maturation of the Bitcoin market will change the position of regulators and ultimately enable the launch of a US Bitcoin ETF. We cannot guarantee when this will be possible, but it may not be too far off.

Various Types of ETF 🎁

Index ETF

The majority of ETFs are index funds, holding securities, and trying to keep up with the performance of stock indices. Index funds track the performance of an index by holding the entire index or representative stocks within the index in a portfolio. Index ETFs, such as leveraged ETFs or inverse ETFs, invest in derivatives and earn a daily multiple or reciprocal of index performance.

Bond ETF

Bond ETFs are popular with bonds such as long-term U.S. Treasury bonds or corporate bonds in good financial standing when investors withdraw funds from the stock market during a recession. Because of this causal relationship, the performance of bond ETFs also reveals macroeconomic conditions. The benefits of bond ETFs, such as reasonable trading fees, vary, but these benefits can be offset when bought and sold by a third party.

Inverse ETF

Inverse ETFs are derivatives that make a profit when a fund's value declines to a level below its benchmark rate of return. It is a type of investment similar to combining a short-term investment or a preemptive investment strategy in anticipation of a decrease in the value of a fund. Inverse ETFs use daily futures as their benchmark return.

Leveraged ETFs

Leveraged exchange-traded funds (ETFs) are a unique type of ETF that allows them to make profits by reacting more sensitively to market movements than other ETFs. Leveraged index ETFs are set up for either bull market or bear market funds. Leveraged ETFs use financial engineering techniques such as stock swaps and derivatives to redistribute a portfolio to achieve a target return. The most common way to set up a leveraged ETF is to enter into a futures contract. When market volatility is high, rebalancing leveraged ETFs can be costly. Investors, however, circumvent this problem by buying and selling futures despite changes in leverage ratios.

Gate.io offers a variety of ETF products in a safe environment.

YB(Gate.io Marketing Agent)'s a comment

Investors in traditional markets can be exposed to Bitcoin prices as regulated through Bitcoin ETFs. This could be a good way for more institutions to adopt crypto coin as an asset class.