The Valkyrie Bitcoin Strategy ETF seeks to purchase enough Bitcoin futures contracts that the notional value of the Bitcoin within the contracts held by the fund are as close to 100% of the fund’s net assets as possible.
This distinguishes Valkyrie from the other proposed funds, all of which plan on investing in other investment vehicles and products that provide exposure to Bitcoin, such as private trusts.
The fund will invest any remaining assets in “collateral investments” defined as U.S. Government securities such as bills and bonds, money market funds, and corporate debt securities.
Corporate debt securities must be issued by a business with a time of purchase rating in one of the four highest categories of a nationally recognized statistical rating organization like S&P Global Ratings. The collateral investments are designed to provide liquidity.
The fund will invest indirectly via a wholly owned Cayman Islands subsidiary that will have the same investment objective, advisor, and sub-advisor. The fund will invest no more than 25% of its total assets each year.
The application lists Steven McClurg, Rafael Zayas, and Ryan Dofflemeyer as the fund’s portfolio managers.
The fund is classified as non-diversified and therefore not required to meet diversification requirements under the Investment Company Act of 1940.
The fund will not invest directly in Bitcoin.