Derivatives help increase liquidity and improve markets for an asset category by allowing investors to bet on ups and downs of an asset, evening allowing individuals to adopt market-neutral strategies. They are also a key component in the creation of many futures-backed ETFs utilized by a range of investors.
The ProShares filing “is a notable one, given the recent momentum behind financial products connected to the cryptocurrency market. While the past few months have seen several filings with the SEC related to cryptocurrency-tied ETFs, NYSE Arca’s submission suggests that at least some of those proposed products are entering the agency’s formal approval stage,” according to CoinDesk.
Prior to the debut of bitcoin futures on Cboe, at least three issuers filed plans for related ETFs while two such filings emerged around the time futures launched on CME.
For more information on the cryptocurrency market, visit our Bitcoin category.