Bitcoin ETF Scorecard | Stablecoin IPO Coming

Premier cryptocurrency falls as investors who bought ahead of the approval sold into the news.

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Nina Bambysheva Senior Reporter, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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THE BITCOIN ETF RACE IS ON

On Wednesday, the Securities and Exchange Commission finally gave approval for U.S. exchange-traded funds directly tied to bitcoin, a historic move for investors looking for exposure to the world’s largest digital asset. Instead of having to purchase it on dedicated crypto exchanges like Coinbase, traders can now invest in bitcoin without the complications and risks of owning the tokens directly.

The announcement came after SEC’s X account was compromised and a fake post claiming that the agency had green-lit the products fueled a brief price rally on Tuesday.

Thursday marked the first trading day for the 10 SEC-approved funds. The $28 billion Grayscale Bitcoin Trust saw the largest volume surpassing $2 billion, an amount that roughly matched the combined volume of the rest of the new ETFs. There is a possibility that Grayscale experienced redemptions, given its higher fee structure. The previous version of the trust, known as GBTC, was a closed-end fund that traded at a discount to net asset value that approached 50% last year.

The other ETFs combined had a trading volume of about $2.3 billion, led by BlackRock with about $1.04 billion and Fidelity at $715 million. The two fund families may have benefited from the refusal of rival Vanguard to offer spot bitcoin ETFs to its customers.

Despite the excitement, the price of bitcoin dropped more than 6% to $43,566, on Friday after briefly surging to $48,948, its highest level since March 2022.

If you plan to invest in these vehicles, here are tax implications to keep in mind.

CIRCLE QUIETLY FILES FOR IPO

The issuer of the USDC stablecoin announced on Thursday that it had confidentially filed paperwork with the SEC for an initial public offering, more than a year after scrapping plans to list shares via a special-purpose acquisition company at a $9 billion valuation.

“The number of shares to be offered and the price range for the proposed offering have not yet been determined. The initial public offering is expected to take place after the SEC completes its review process, subject to market and other conditions,” Circle said in a press release.

At the time Circle first announced its SPAC plans in July 2021, there was nearly $26 billion worth of USDC in circulation. That number has slightly fallen while chief rival Tether has jumped more than 50% to $95 billion.

CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$43,426

0.4%

Ether (ETH)

$2,582

16.4%

Tether (USDT)

$1.00

0%

Binance Coin (BNB)

$301

3.4%

Solana (SOL)

$95

1.7%

Source: Forbes Digital Assets. Prices as of 3:22 p.m. on January 12, 2024.

SOFI’S LATEST EARNINGS RAISE QUESTIONS ABOUT ITS GROWTH

Thirteen years after its founding, the $2 billion student lender’s executives are buzzing about its growth and profitability, but its SEC filing tells a different tale. The company managed to lose $266.7 million in the third quarter, four times more than the $61.5 million shortfall expected on Wall Street, according to Bloomberg. The loss itself was mostly on paper, the result of an accounting requirement known as a goodwill impairment that had to do with recent acquisitions. Still, the charge against earnings was not foreseen by the equity analysts who follow the company…Read more.

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