Former Citigroup executive plans to launch Bitcoin securities without SEC approval

Zhitong App has learned that as speculation about the approval or rejection of Bitcoin spot ETFs reaches a fever pitch, a group of former Citigroup executives plans to issue Bitcoin securities, claiming that these securities do not require approval from US regulatory agencies. The newly issued Bitcoin depositary receipts will be similar to American depositary receipts representing foreign stocks. The startup, Receipts Depositary Corporation (RDC), plans to issue the first batch of Bitcoin depositary receipts to eligible global institutional investors, and these transactions do not need to be registered under the US Securities Act of 1933.

RDC stated that this issuance will enable institutional investors to obtain Bitcoin securities through regulated market infrastructure in the United States and settle through the Depository Trust Co.

According to information, RDC's investors include Franklin Templeton, BTIG, and Broadhaven Ventures.

This week, the price of Bitcoin broke through the $45,000 mark for the first time in nearly two years, and people are increasingly optimistic that the US Securities and Exchange Commission (SEC) will soon approve Bitcoin spot ETFs.

Ankit Mehta, co-founder and CEO of RDC and former Citigroup executive, stated that RDC will provide a product that is "complementary" to Bitcoin ETFs.

Mehta stated that compared to Bitcoin ETFs that will be redeemed for cash, depositary receipts provide qualified institutions with direct ownership of Bitcoin. He added that direct purchase of Bitcoin is not favored by some regulatory agencies due to security risks and regulatory uncertainties in the cryptocurrency market. American depositary receipts alleviate these challenges.

Diogo Mónica, co-founder and president of Anchorage Digital, stated, "Introducing market standards of traditional finance, such as depositary receipts, into the digital asset ecosystem will be a major theme in 2024." "Most traditional institutions want direct exposure to Bitcoin, but due to regulatory uncertainties, some institutions are still taking a wait-and-see approach. For these players, using Bitcoin depositary receipts can achieve the best of both worlds."

It has been reported that Citigroup briefly developed a similar product as early as 2018. The three co-founders of RDC were members of Citigroup's team that developed digital asset certificates. Mehta stated that RDC's issuance is "independent" of Citigroup's exploration.