Canada Approves World's First Bitcoin ETF

The Ontario Securities Commission approved the launch of the world’s first Bitcoin ETF on February 12, 2021, as announced by Purpose Investments Inc. This ETF, known as Purpose Bitcoin ETF, allows investors direct investment in physically settled Bitcoin, not derivatives. The ETF provides easier and more efficient access to cryptocurrency, contrasting with previous options like futures contracts on the CME derivatives exchange or closed-end investment funds.

The ETF’s approval coincided with a record high Bitcoin price at the time of $48,975 and followed significant Bitcoin investments by companies like Tesla. The approval in Canada was seen as a potential precursor for similar approvals in the U.S., despite the SEC’s cautious approach due to concerns over market manipulation and custody audits.