A brand new regulatory filing from Tidal Trust proposes listing and trading an exchange-traded fund that can hold Bitcoin outside of market hours.
In a filing with the U.S. Securities and Exchange Commission on Tuesday, Tidal Trust II filed a registration statement on Form N-1A so as to add two Bitcoin (BTC)-linked ETFs from Nicholas Wealth Management to its existing fund.
The offerings, which included the Nicholas Bitcoin and Treasuries AfterDark ETF, only bought BTC when US market trading hours closed and sold it on the open, effectively holding it throughout the day.
“When using Bitcoin futures, the Fund trades these instruments during U.S. overnight hours and closes them shortly after the U.S. market opens each trading day,” the SEC filing said. “When using Bitcoin underlying funds, the fund purchases a security on the US market close after which sells the position on the US market open, thereby capturing any market movements that occurred during US overnight hours.”
Tuesday SEC Files “AfterDark” Bitcoin ETF. Source: SEC
The asset management company said the ETF will invest its assets in “U.S. Treasury securities, money market funds and other money equivalents” through the day. Such an investment strategy would effectively allow traders to avoid a few of the potential price volatility that comes with indirect exposure to Bitcoin.
“We checked out this last 12 months and located that almost all of the gains actually are available the after-hours,” ETF analyst Eric Balchunas responded to the filing. “That doesn't mean the ETFs don't have an effect. Part of it’s positioning [because] the ETFs etc. or derivatives based on flows etc. etc. But yes, the Bitcoin After Dark ETF could do higher [returns].”
The filing doesn’t guarantee SEC approval and is subject to alter. The regulator has given the green light to many crypto-related investment vehicles, including Bitcoin and Ether (ETH) futures ETFs, spot digital asset ETFs and staked crypto ETFs.
Record outflows from US spot Bitcoin ETFs in November
Spot Bitcoin ETFs listed on US exchanges saw record outflows in November, with around $4 billion being withdrawn. BlackRock's iShares Bitcoin Trust and Fidelity's Wise Origin Bitcoin Fund led the redemptions as two of the biggest ETFs available in the market.
