Coinbase rises on 'crypto legitimacy' after Bitcoin futures ETF launch
19/10/2021 15:49
** Coinbase Global COIN.O shares up 4.4% Tuesday at
$297.48 amid Bitcoin's BTC= listing of a futures-based U.S.
exchange-traded fund urn:newsml:reuters.com:*:nL1N2RF0EB
** ProShares Bitcoin Strategy ETF BITO.K on NYSE Arca
listed on Tuesday following the end of a 75-day period, in which
the U.S. securities regulator could object to the listing
** "COIN benefits from the tacit approval of a bitcoin
futures ETF as it brings more credibility and attention to the
crypto space as a whole and will likely lead to higher volumes
across the industry over time" - Piper Sandler
** Lists benefits as: exposure for institutional investors;
lack of a risk of wallet hacks and lost passwords/keys or
physical damage; deep liquidity of futures markets with
significantly more volume than crypto markets
** Warns that while crypto adoption will be good for COIN in
long run, "things could get choppy in the near term"; says COIN
might see short-term headwinds when Bitcoin futures ETFs start
trading as investors shift their crypto exposure towards ETFs
and away from COIN
** Other "cons" include cost of carry and Bitcoin futures
ETF possibly incurring costs when contracts are rolled over,
which could lead to a tracking error that would not be present
in a fund backed by physical Bitcoin
** Bitcoin hit a six-month high and was within sight of its
all-time peak on Tuesday urn:newsml:reuters.com:*:nL1N2RF0EB
** BTC up 42.9% this month vs COIN up 30.47% this month
(Reporting by Anisha Sircar)
((Anisha.Sircar@thomsonreuters.com))