Introducing Bitcoin Depository Receipts
A group of former Citigroup executives has launched a new product called Bitcoin Depository Receipts (BTC DR). This offering is designed to be a complimentary product to spot bitcoin exchange-traded funds (ETFs) that are expected to be approved by the U.S. Securities and Exchange Commission (SEC) soon.
What are Bitcoin Depository Receipts?
Receipts Depositary Corporation (RDC), the startup formed by these former Citigroup executives, describes bitcoin depositary receipts as similar to American Depositary Receipts (ADRs) for foreign stocks. These bitcoin depositary receipts operate within the U.S.-regulated market infrastructure and are cleared through the Depository Trust Company (DTC).
RDC plans to issue the first BTC DRs in exempt transactions under the Securities Act of 1933 to qualified institutional buyers (QIBs) in the next few weeks.
Backed by Major Institutions
RDC is backed by major institutions such as Franklin Templeton, BTIG, and Broadhaven Ventures. Anchorage Digital Bank National Association will handle the custody of bitcoin, and Broadridge Corporate Issuer Solutions will serve as the transfer agent for RDC.
Partnership Announcement
Anchorage Digital independently announced its partnership with Receipts Depository Corporation. They stated, “We are proud to announce our partnership with Receipts Depositary Corporation … As the first and only OCC-chartered digital asset bank, we look forward to supporting the launch of the first-ever bitcoin depositary receipt.”
A Conversion Tool for Asset Owners
Ankit Mehta, RDC’s co-founder and chief executive, explained that their offering is a conversion tool for asset owners. It allows hedge funds, family offices, corporations, and large institutional investors to convert their bitcoin into a DTC-eligible security and enjoy direct ownership in U.S. clearances.
Hot Take: Bitcoin Depositary Receipts Offer New Opportunities for Institutional Investors
The launch of Bitcoin Depository Receipts presents an exciting opportunity for institutional investors looking to have a regulated and secure means of owning and trading bitcoin. With the expected approval of bitcoin ETFs by the SEC, the introduction of this complementary product adds further legitimacy to the cryptocurrency market. By converting their bitcoin holdings into DTC-eligible securities, asset owners can benefit from streamlined clearance and enjoy direct ownership in the U.S. market. This innovative offering signals an important milestone in the integration of cryptocurrencies into traditional financial systems.
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