Crypto assets Bonk, Litecoin, and SUI are reportedly linked to financings for a vibrant digital currency ETF. Is there a potential impact on their prices?
In a move that has caught the attention of the crypto industry, Tuttle Capital, a $3.6 billion asset manager, has filed for the second-ever spot BONK [BONK] ETF. The proposed fund, known as the "Bonk Income Blast ETF," was submitted to the SEC on September 16th.
The unconventional design of the funds has already sparked conversation among industry watchers. Unlike traditional ETFs, the Bonk Income Blast ETF, along with the Litecoin [LTC] Income Blast ETF and the Sui [SUI] Income Blast ETF, uses a put credit spread strategy executed with FLEX Options for income generation and controlled exposure to their respective tokens.
The filing indicates that appetite for meme-inspired crypto products remains undeterred by regulatory hesitation. The use of FLEX Options helps ensure more transparent price discovery while avoiding counterparty risks that typically come with over-the-counter (OTC) options.
BONK, the meme coin in question, saw a 4% increase in the past 24 hours, reaching $0.0000242 before easing slightly to $0.00002376, still up 2.36% at press time. SUI followed suit, climbing over 3% to trade at $3.61, while LTC briefly touched $115.2 before settling at $114.71, up 0.34% on the day.
Bloomberg ETF analyst James Seyffart acknowledged the creativity behind Tuttle's filing. The proposed funds aim to generate current income first, with a secondary goal of tracking the daily performance of their underlying tokens within capped gains.
Market sentiment reflected the buzz around Tuttle Capital's filing, with several altcoins recording modest gains. Tuttle Capital has noted Grayscale and Bitwise as competitors in the filing of the Bonk ETF.
The Bonk Income Blast ETF combines income generation with controlled exposure to BONK, using a put credit spread strategy via FLEX Options. The application for the fund was submitted under the Investment Company Act of 1940, adding another layer of legitimacy to the nascent meme coin market.
Despite SEC delays extending into November, optimism remains among investors. The rise in BONK, SUI, and LTC prices suggests a positive outlook for these meme coins, despite regulatory uncertainties. The success of the Bonk Income Blast ETF, if approved, could pave the way for more innovative crypto ETFs in the future.
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