In an interesting move, 7RCC, a company specializing in developing solutions for ESG-conscious investors, has submitted an application for a Spot Bitcoin Exchange-Traded Fund (ETF) with the United States Securities and Exchange Commission (SEC). However, the proposal has a unique twist: it aims to provide a carbon-neutral investment option in the digital asset space.
7RCC Bitcoin ETF Application
The filing with the SEC outlines a strategic approach to cater to investors committed to environmental, social, and governance (ESG) principles. The proposed ETF is set to comprise 80% Bitcoin and 20% carbon credit futures, aligning with the growing trend of ESG-conscious investing in the digital asset sector.
Related reading: Bitcoin is ESG Compliant: A KPMG Report
The investment objective of the ETF is to mirror the fluctuations in Bitcoin prices and the value of carbon credit futures, represented by the Vinter Bitcoin Carbon Credits Index. These carbon credit futures are directly linked to emissions allowances issued under key environmental programs such as the European Union Emissions Trading System, the California Carbon Allowance, and the Regional Greenhouse Gas Initiative.
Interestingly, renowned digital asset exchange Gemini would be the custodian for the 7RCC Bitcoin and Carbon Credit Futures ETF. This move underscores the exchange’s commitment to supporting innovative financial instruments and providing investors with opportunities to diversify their portfolios. The announcement reads:
“The 7RCC Bitcoin and Carbon Credit Futures ETF is well positioned to differentiate itself from the more than a dozen other spot bitcoin ETF applications seeking SEC approval. 7RCC, an alternative investment manager, aims to build a bridge between the digital asset industry and ESG-conscious investors with a focus on ETFs.”
The Bitcoin Community Reacts
The filing has sparked enthusiasm among industry analysts, with prominent figures like Nate Geraci, president of The ETF Store, acknowledging the inevitability of a Bitcoin “ESG” ETF. Geraci anticipates further evolution in Spot Bitcoin ETFs, emphasizing that diverse permutations of such ETFs are on the horizon. He commented:
“It was only a matter of time before we got an “ESG” bitcoin ETF. We’re going to see all types of permutations on spot bitcoin ETFs.”
Despite this optimism, ongoing debates persist regarding the practicality and regulatory acceptance of this innovative hybrid digital asset investment vehicle.
SEC’s Proactive Approach
Meanwhile, the SEC is reevaluating its stance on Spot Bitcoin ETFs, prompted by recent “court rulings.” Gary Gensler, the head of the regulatory body, disclosed that the SEC is currently scrutinizing between 8 and 12 applications, signaling a potentially transformative period for the Bitcoin ETF landscape.
Bloomberg analyst James Seyffart shares a positive outlook, predicting that the SEC will greenlight the first Spot Bitcoin ETFs in January 2024.
Seyffart speculates that the SEC strategically delayed approving applications for this financial instrument to greenlight a majority of them simultaneously, preventing any issuer from gaining a competitive advantage.
7RCC’s carbon-neutral Bitcoin ETF proposal stands as a testament to the sector’s commitment to aligning with sustainable and socially responsible investing practices. The forthcoming months will likely witness further developments in the regulatory approval process and the broader evolution of Spot Bitcoin ETFs.
