This notice means that exchange-traded funds and similar investment instruments with Bitcoin or other cryptocurrencies as underlying assets will not be assigned any collateral value.
The financial services giant DTCC has stated that it will not allocate any collateral to exchange-traded funds (ETFs) with exposure to Bitcoin or cryptocurrencies and will not extend loans against them.
DTCC’s announcement states that effective April 30, 2024, the Depository Trust and Clearing Corporation (DTCC) will implement changes to collateral values for specific securities during its annual line-of-credit facility renewal, potentially affecting position values in the Collateral Monitor.
This notice released on April 26 means that exchange-traded funds and similar investment instruments with Bitcoin or other cryptocurrencies as underlying assets will not be assigned any collateral value, resulting in a 100% reduction in their collateral value.