The former head of the World Gold Council intends to launch Bitcoin ETF

• Jason Toussaint develops a bitcoin-based ETF.
• Regulators will change their attitude as the market becomes more mature.

Former Executive Director of the World Gold Council (WGC) Jason Toussaint is working on a Bitcoin ETF in partnership with the asset management firm Kryptoin Investment Advisors, CoinDesk reports.

A Delaware company filed a registration application with the U.S. Securities and Exchange Commission (SEC). Toussaint, who previously also managed one of the largest SPDR Gold Shares ETFs, now steers the development of the new exchange-traded product in the company.  

The value of cryptocurrency assets held by the fund will be determined based on the Chicago Mercantile Exchange reference rate – CME CF Bitcoin Reference Rate. Following approval, ETFs will be listed on the NYSE Arca Exchange.

“The benefits and challenges, when it comes to bitcoin as an asset class, are similar to what they were when the Gold Council brought SPDR Gold Shares to the market. There was also a lot of learning the SEC had to go through to fully understand and gain a level of comfort with the underlined gold market,” he said as cited by CoinDesk.

There are two aspects that are crucial for the regulator’s approval of a new product – an agreement on the exchange of information between the ETF provider and the exchanges, as well as a better understanding of the SEC underlying market, according to Toussaint.

He also noted that regulators oppose bitcoin-based ETFs the same way they opposed to gold ETFs. Since both assets are not publicly traded securities, the SEC is concerned about pricing transparency and volume manipulation, he explained.

The ex-director of WGC thinks that the approval process may take time, but as the spot and futures markets develop, the regulator will adopt more favorable approach to cryptocurrency.

The SEC is also considering a recently updated application for Bitcoin ETF from Wilshire Phoenix. Earlier, the regulator rejected the proposal to launch such a fund from Bitwise Asset Management. The company has already announced plans to submit a new application for Bitcoin ETF.