Strive Files Application for Bitcoin Bond ETF with SEC
Strive, founded by Vivek Ramaswamy, has filed with the SEC to launch a Bitcoin Bond ETF. This proposed ETF will invest in convertible bonds from companies like MicroStrategy, which utilize raised funds to acquire Bitcoin. The filing details Strive's strategy to actively manage the ETF through direct bond investments or financial instruments such as swaps and options.
MicroStrategy, led by Michael Saylor, has significantly increased its Bitcoin holdings throughout 2024, purchasing over $4 billion of BTC in December alone. This acquisition strategy has driven MicroStrategy's stock price up nearly 400% this year, leading to its addition to the Nasdaq-100 index and potential inclusion in the S&P 500 next year. The company finances these large purchases primarily through issuing shares and convertible bonds, often at low interest rates that convert to stock.
ETF analyst Eric Balchunas notes that the proposed ETF reflects MicroStrategy’s approach until other firms adopt similar methods. This financial product targets investors wanting indirect exposure to Bitcoin without direct ownership. Strive’s initiative coincides with the increasing popularity of Bitcoin-related investment products, particularly following the SEC's approval of dual Bitcoin and Ethereum ETFs from Hashdex and Franklin Templeton earlier this month.
The demand for Bitcoin exposure among retail investors drives innovation in financial products. Vivek Ramaswamy co-founded Strive in 2022, advocating for financial independence from large institutional investors. He is also involved in initiatives like the Department of Government Efficiency (DOGE) aimed at reducing government spending.
MicroStrategy has invested over $27 billion in Bitcoin since 2020, resulting in a 2,200% increase in its stock price. This trend signifies a market perception of Bitcoin as a long-term strategic asset. Strive’s ETF would allow retail investors to access this growth indirectly, mitigating some risks associated with direct cryptocurrency ownership.
Industry experts predict further crypto ETF approvals if favorable policies arise under a potential Trump administration, driven by increasing regulatory acceptance of Bitcoin. Some analysts propose that a US Bitcoin reserve could materialize sooner than anticipated.
Crypto influencer, The Bitcoin Therapist, expressed optimism regarding Ramaswamy's ETF proposal, suggesting significant shifts in the US's approach to Bitcoin are underway, potentially fostering broader adoption of Bitcoin-based financial products nationally.
The Bitcoin Bond ETF concept offers exposure to both Bitcoin and the financial strategies of companies like MicroStrategy. Investors may benefit from rising Bitcoin prices and corporate stock performance without directly holding Bitcoin.
Strive's ETF application signifies a broader transition in the financial sector towards Bitcoin-based instruments. As Bitcoin adoption increases and traditional finance integrates cryptocurrency, products like the Bitcoin Bond ETF may become essential for investors seeking diversified exposure in the digital asset market.