Cryptocurrency NewsBitwise Innovates in Crypto ETF Space

Bitwise Innovates in Crypto ETF Space

Bitwise, a leader in the financial technology sector, recently made headlines by openly sharing the wallet address for its Bitcoin Exchange-Traded Fund (ETF). This marked the first occasion a company in this space has taken such a step. Following this announcement, the wallet unexpectedly started receiving Bitcoin donations from enthusiastic supporters of the ETF.

Interestingly, these contributions were not just limited to small Bitcoin amounts like 0.00042069 BTC. The wallet also accumulated a variety of BRC-20 tokens, Bitcoin-themed domain names, and an assortment of Bitcoin-related Non-Fungible Tokens (NFTs). These spontaneous donations collectively surpassed the $5,000 mark in value.

Matt Hougan, the Chief Investment Officer at Bitwise, highlighted that these additional assets will be channeled for the benefit of BITB fund shareholders. As per Bitwise’s regulatory filings (S-1), any assets received unintentionally may be liquidated and the proceeds equitably distributed among the fund’s investors.

Earlier versions of the S-1 filing had floated the idea of distributing these assets in-kind to shareholders, but this concept was not included in the final approved document.

A significant discussion point in the cryptocurrency community has been the protocol for handling assets received from addresses sanctioned by the Office of Foreign Assets Control (OFAC) of the U.S. Treasury. The issue is that Bitcoin wallets cannot inherently reject incoming transfers, even from blacklisted addresses.

Hougan clarified that this dilemma is addressed at the custodial level. Bitwise employs Coinbase for its custodial services. A representative from Coinbase confirmed their proactive measures to block transactions from OFAC-sanctioned addresses.

This approach by Bitwise demonstrates a cooperative effort with their clients to ensure compliance with legal obligations. Coinbase’s strategy in dealing with funds from sanctioned addresses is elaborated in one of their blog posts. It states that such funds are moved to a secure internal Coinbase account, adhering to regulatory requirements.

source

Join us

12,746FansLike
1,625FollowersFollow
5,652FollowersFollow
2,178FollowersFollow
- Advertisement -