DTCC's Decision and Impact on Bitcoin ETFs

Saturday, 27 April 2024, 21:27

The Depository Trust and Clearing Corporation (DTCC) has announced a 100% haircut policy on all investment instruments backed by cryptocurrencies, affecting Bitcoin ETFs and collateral valuation. The decision could result in reduced liquidity, increased investor risk, and changes in Wall Street leverage strategies. Speculations on potential impacts and expert opinions contrast the implications of this policy change.

https://store.livarava.com/2837275b-04de-11ef-a6c0-63e1980711b2.png — DTCC's Decision and Impact on Bitcoin ETFs

DTCC's Policy Change Impacts Crypto ETFs

DTCC has decided to implement a 100% haircut policy on investment vehicles containing cryptocurrencies, affecting Bitcoin ETFs and collateral valuation in the financial markets.

Implications on Trading Operations and Position Valuation

Effective from April 30, the decision may affect the position valuation in the collateral monitor, limiting the use of crypto exchange-traded products as collateral.

Quote:

“No collateral value will be given for any ETF or investment vehicle containing Bitcoin or cryptocurrencies, subject to a 100% haircut,” DTCC stated.

Discussion:

Speculations on reduced liquidity, investor risk, and changes in leverage strategies that could follow the policy change portray varying opinions from industry experts and financial institutions.

This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.

DTCC's Policy Change Impacts Crypto ETFs

Implications on Trading Operations and Position Valuation

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