In a groundbreaking development for cryptocurrency markets, Bitwise Asset Management has become the first firm to file for a spot Chainlink ETF, potentially opening new investment avenues for digital asset enthusiasts and traditional investors alike. This strategic move signals growing institutional confidence in altcoin adoption.
Bitwise Chainlink ETF Filing Details
Bitwise submitted its Form S-1 to the Securities and Exchange Commission on Tuesday. The proposed Bitwise Chainlink ETF will hold and track LINK tokens directly. Coinbase Custody will serve as the fund’s custodian. Importantly, the ETF plans to offer in-kind creation and redemption using LINK tokens.
Market Impact and LINK Performance
The announcement immediately affected market dynamics. LINK gained 4.2% to $24.18 within 24 hours of the filing. Furthermore, the token has surged over 26% in the past month. This Chainlink ETF filing represents the first such application in the United States.
Growing Altcoin ETF Competition
Meanwhile, other asset managers pursue similar strategies. VanEck recently filed for a JitoSOL ETF. Grayscale seeks to convert its Avalanche trust into an ETF. Additionally, Canary Capital filed two crypto ETF proposals this month. This Chainlink ETF initiative follows Bitwise’s successful Bitcoin and Ethereum funds.
Regulatory Landscape and Approval Process
The Trump administration’s crypto-friendly approach has encouraged filings. However, Bitwise must still submit Form 19b-4 to begin official SEC review. Approval could take several months. This Chainlink ETF would provide regulated exposure to oracle network tokens.
Investment Implications and Market Structure
The proposed Chainlink ETF offers several advantages:
- Regulated access to Chainlink’s native token
- In-kind transactions using LINK tokens
- Professional custody through Coinbase
- Traditional brokerage accessibility
Frequently Asked Questions
What is a spot Chainlink ETF?
A spot Chainlink ETF would hold actual LINK tokens and track their price, unlike futures-based products that derive value from contracts.
When might the Bitwise Chainlink ETF launch?
The approval process typically takes 6-12 months after complete application submission, depending on SEC review timelines.
How does this differ from Bitcoin ETFs?
While similar in structure, this Chainlink ETF would track a different underlying asset with distinct market dynamics and use cases.
What are the risks of investing in a Chainlink ETF?
Rights include cryptocurrency volatility, regulatory changes, technology risks, and market adoption uncertainties affecting LINK’s value.
Can investors redeem shares for actual LINK tokens?
The filing indicates in-kind creation and redemption, suggesting authorized participants could exchange shares for tokens.
How might this affect Chainlink’s ecosystem?
ETF approval could increase institutional investment, liquidity, and mainstream adoption of Chainlink’s oracle services.
