VanEck and SolidX today announced that the VanEck SolidX Bitcoin Trust (the Trust) will issue shares (the Shares) to Qualified Institutional Buyers (QIBs) in accordance with Rule 144A under the Securities Act of 1933, as amended (the Securities Act).
The shares will provide institutional investors access to a physically-backed bitcoin product that is tradeable through traditional and prime brokerage accounts. The Shares are the first institutional-quality, cleared product providing exposure to bitcoin and enabling a standard ETF creation-and-redemption process. SolidX is the sponsor of the Trust and VanEck provides marketing services.
BNY Mellon will act as the daily fund accountant, administrator, and transfer agent, which includes facilitating the investor creation and redemption activity.
SolidX was among the first to file with the SEC a registered physically-backed bitcoin ETF and the first to include an innovative insurance feature as part of its approach. VanEck and SolidX continue to work on being able to offer a registered product. The Trust’s issuance of Shares allows QIBs to access many of the same features and mechanisms envisioned in such a public offering, including insurance against the theft or loss of the Trust’s bitcoin private keys and the open-end creation and redemption of shares.
In the event the SEC approves the Trust’s registration of public shares, i.e. an Exchange Traded Fund (ETF), the 144A issued Shares may benefit from public market resales.
“Institutional demand for bitcoin exposure is uncertain, because institutional quality vehicles simply have not, to this point, been readily available. We’re introducing a solution for institutions that fits within their operational processes and the current regulatory framework.”
“Utilizing OTC prices to value bitcoin enhances price transparency and the institutional quality of the offering. The OTC desks in the MVIS Bitcoin US OTC Spot Index have efficient price discovery mechanisms, systems, policies, and procedures for correcting pricing anomalies, abnormalities, and extremities and are overseen by regulators.”
– Jan van Eck, Chief Executive Officer of VanEck
VanEck, a firm with a 50+ year track record of engineering forward-looking, intelligently designed investment strategies, has been a leader in the digital assets space, having pioneered several comprehensive digital asset indices through its MVIS subsidiary. The VanEck SolidX Bitcoin Trust will price its NAV based on the MVIS Bitcoin US OTC Spot Index, which is designed to track price feeds from major OTC bitcoin liquidity providers.
“As the first bitcoin product in the U.S. with standard ETF creation and redemption and established clearing and settlement processes, institutional investors can finally gain exposure to bitcoin within a familiar context. We view the product as an exciting next step for SolidX and VanEck in our partnership as we work to bring institutional-quality crypto asset products to the marketplace.”
– Daniel H. Gallancy, Chief Executive Officer of SolidX
The Shares can be quoted on OTC Link ATS, an SEC-regulated alternative trading system using a fully attributable, network-based model for publishing quotes and negotiating trades, on September 5, 2019. Broker-dealers gain access through the proprietary OTC Dealer user interface or by using OTC FIX protocol.
“We are heavily focused on supporting innovation in asset management, including in the delivery of digital currency strategies and investment options to investors. We are excited to leverage our firm’s focus on digital and alternative asset classes with aspects of ETF-servicing through the creation and redemption process to facilitate investor access into this first-of-a-kind offering access to Bitcoin.”
– Jeff McCarthy, Global Head of Exchange Traded Products at BNY Mellon
The Shares have not been registered under the Securities Act or any state securities laws, and unless so registered, may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws.
This release is neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall it constitute an offer, solicitation or sale of any securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.