Truth Social’s Bold Entry into Crypto ETFs
Trump Media-owned social media platform Truth Social has filed an S-1 registration with the United States Securities and Exchange Commission (SEC), in an effort to list an exchange-traded fund (ETF) that will follow blue-chip cryptocurrencies. The proposed “Truth Social Crypto Blue Chip ETF” will replicate a basket of leading cryptocurrencies, which include Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Cronos (CRO), and XRP.
ETF Structure and Allocation
According to the filing, the ETF will hold 70% in Bitcoin, 15% in Ether, 8% in Solana, 5% in Cronos, and 2% in XRP. The underlying assets will be held by a custodian, and any variation from the proportion of allocation would require regulatory permission and an amendment to the agreement. The ETF is organized as a Nevada business trust and is being supported by Yorkville America Digital.
Aspiring for NYSE Arca Listing
The Truth Social ETF is aimed to list on the NYSE Arca, pending approval from the authorities. This filing is the latest attempt by the company to enable exposure to cryptocurrencies for retail and institutional investors through traditional equity markets. Interestingly, the ETF will not be considered a registered investment company and will be exempt from Commodity Futures Trading Commission (CFTC) regulations as a commodity pool.
Instead, the ETF will sell and redeem shares in increments of 10,000 units via authorized broker-dealers. This process helps maintain the price of the ETF near its underlying asset value.
Following a BTC-ETH ETF Filing
This filing is in addition to Truth Social’s earlier attempt at launching a two-position Bitcoin and Ether ETF, filed in June. The ETF, that invests 75% of the fund in Bitcoin and 25% in Ether, is also in the queue for SEC approval. The ETF would simplify the process for investors by eliminating the complexities of purchasing Bitcoin and Ethereum separately.
