In a surprising move, asset management firm VanEck announced that it plans to close and liquidate its VanEck Bitcoin Strategy ETF (XBTF), just two years after its launch on the CBOE in November 2021.
On January 16, 2024, the Board of Trustees of VanEck ETF Trust officially approved the liquidation and dissolution of the fund, which has been listed on the CBOE under the ticker XBTF.
This decision comes just a week after the US Securities and Exchange Commission (SEC) granted approval for the firm to list shares of its new VanEck Bitcoin ETF, signaling an unexpected strategic direction.
The firm, in its capacity as sponsor of the VanEck ETFs, indicated that the decision was based on an ongoing evaluation of crucial factors such as fund performance, liquidity, assets under management and investor interest.
According to VanEck, analysis of these factors and other operational considerations led to the conclusion that liquidation of the fund was the most appropriate course of action at this time.
Shareholders have until January 30, 2024, at market close, to sell their shares in the fund on the exchange where it is listed.
After this date, the shares will cease trading and will be delisted.
The fund’s estimated liquidation date is February 6, 2024, and shareholders who retain their holdings until then will receive a cash distribution equal to the net asset value of their shares.
In an additional statement, VanEck provided information on the company’s current status, highlighting its track record of identifying impactful investment opportunities and its management of approximately $89.5 billion in assets as of the end of 2023.
VanEck emphasized the diversity of its strategies backed by well-designed investment processes
Additionally, important warnings were included regarding the risks associated with investing in Bitcoin and Bitcoin futures.
VanEck pointed to market volatility, regulatory risks, counterparty risks, and other factors specific to the cryptocurrency environment as key elements to consider.
In the statement, the compay also stressed the importance of thorough research before investing in cryptocurrencies, highlighting the complexity and volatility inherent in these assets.
The lack of regulation in the cryptocurrency market and the absence of government support were highlighted by the company as additional elements of risk.
This decision by VanEck to close its Bitcoin Strategy ETF can be interpreted as a response to changing market conditions and the need to adjust the firm’s product offering according to investor preferences and demands.
