Nasdaq Exec: Winklevoss Bitcoin Trust Could Be Significant for ETF Industry

In a new interview, Nasdaq Vice President of Transaction Services and Head of ETF business David LaValle has called the Winklevoss Bitcoin Trust a "significant" development for the exchange-traded fund (ETF) industry.

The ETF, first proposed by noted bitcoin investors Cameron and Tyler Winklevoss in July 2013, has been in a state of regulatory flux as the potential offering moves through the approval process. According to recent filings with the Securities and Exchange Commission (SEC), the ETF would trade under the name ‘COIN’.

During his conversation with ETF.com, LaValle discussed the ramifications of the bitcoin ETF on the broader marketplace. Overall, he sees the Winklevoss effort as a positive one, saying:

"I think it’s significant that we’re on the precipice of a new investable asset that’s coming to market or becoming available to investors first in the form of an ETF. In some ways, it gives the ETF credibility, and it accentuates many of the benefits of the ETF as an investment wrapper. To that extent, it’s important for the ETF industry."

During the interview, LaValle touched on the nature of ETF investment and how bitcoin may fit within the bitcoin industry.

Notably, the Winklevoss twins also recently launched a bitcoin price index, Winklevoss Index, known commonly as the WinkDex, that will provide market information to the ETF should it be listed.

Boosting bitcoin availability

For LaValle, the advantage of having a bitcoin ETF lies in the fact that, from an investor standpoint, it’s simply an easier way to gain market access than buying bitcoin directly. This, he explained, makes the digital currency more attractive – and trustworthy – for investors.

He told ETF.com:

“There’s availability for accessing the investment in different ways, and each investor is able to pursue that investment thesis through whichever wrapper they’re comfortable with. But, I think bringing it in an ETF wrapper gives bitcoins more credibility.”

Beyond that, however, LaValle sees bitcoin as being “quite dynamic” and, as a result, a draw to investors with the right risk appetite.

He added that the ETF might be serve as both a trading and investing tool for those who get involved, but that it’s tough to say until the ETF – if at all – receives regulatory approval.

New type of investment

When asked if the bitcoin ETF represents an innovation in the market, LaValle was cautiously optimistic.

The Nasdaq executive said that the ETF, if listed, will present investors with a potentially game-changing option. He added that, from the product generation standpoint, the bitcoin ETF is certainly a step in an interesting direction and that bitcoin represents a new avenue for investors.

However, he stopped short of endorsing the Winklevoss Bitcoin Trust, concluding:

“Time will tell how big of an innovation this is.”

Hat Tip to ETF.com

Images via Nasdaq and Shutterstock