Bitwise Dogecoin ETF: A New Era for Memecoin Investments
The most famous memecoin in the world is on the verge of becoming part of the ETF landscape. NYSE Arca has formally submitted a 19b-4 application to the U.S. Securities and Exchange Commission (SEC) to secure approval for listing and trading the Bitwise Dogecoin ETF. If this proposal gains approval, it will be among the pioneering Dogecoin-centric exchange-traded funds (ETFs) listed in the United States, providing regulated access to a cryptocurrency that started as an online joke but has grown into a massive digital asset.
Progress for Dogecoin ETF: A Step Forward
On March 3, NYSE Arca, a branch of the New York Stock Exchange, presented a detailed proposal—known as a 19b-4—to the SEC. This proposal requests regulatory changes that would allow the listing of Bitwise’s ETF under NYSE Arca Rule 8.201-E, which pertains to Commodity-Based Trust Shares.
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The filing specifies: “Following the guidelines of Section 19(b)(1) of the Securities Exchange Act of 1934, as amended (the ‘Act’ or ‘34 Act’) and Rule 19b-4 therein, NYSE Arca, Inc. (‘NYSE Arca’ or ‘Exchange’), intends to list and trade shares of the Bitwise Dogecoin ETF (the ‘Trust’) under NYSE Arca Rule 8.201-E (Commodity-Based Trust Shares).”
Bitwise initially revealed its plans in late January by submitting an S-1 registration form to the SEC, outlining its intention to introduce a Dogecoin ETF. Now, the 19b-4 filing is a crucial advancement in the regulatory pipeline, allowing the SEC to commence a formal review process.
Institutional Infrastructure: A Key Feature
A notable aspect of Bitwise’s proposal is the robust institutional support it includes. Coinbase Custody is set to act as the custodian for the fund’s Dogecoin assets, ensuring the security of the cryptocurrency. Concurrently, the Bank of New York Mellon (BNY Mellon) is expected to manage cash custody, administration, and record-keeping, thereby incorporating traditional financial mechanisms.
The ETF is structured to utilize cash creations and redemptions, which means investors will not directly handle DOGE transactions. According to the submission, the fund will mirror the price of Dogecoin by using the CF Dogecoin-Dollar Settlement Price, a pricing benchmark that computes a daily Net Asset Value (NAV) closely aligned with the token’s market value.
Competition and Market Sentiment
Bitwise is not alone in the quest to establish a Dogecoin ETF. Other entities, including Grayscale and Rex Shares, have also submitted proposals for comparable products. Grayscale’s DOGE ETF filing has already received acknowledgment from the SEC, marking a crucial step towards potential approval. For Grayscale, this acknowledgment initiates a formal review period by the regulator, with a potential decision anticipated around mid-October.
As the SEC evaluates these proposals, market analysts have become increasingly optimistic about the approval prospects for a Dogecoin ETF by 2025. Predictions have grown more favorable recently, with notable experts from Bloomberg suggesting the likelihood of any Dogecoin ETF approval could be as high as 75%.
As of the latest update, DOGE is trading at $0.19.
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