Former Citigroup Execs Plan to Launch Bitcoin Securities That Don’t Need SEC Approval

Formerly of Citigroup Inc. A group of executives with Franklin Templeton, BTG and Broadhaven Ventures are set to offer bitcoin-backed securities that they say will not require approval from US regulators.

As the debate and speculation surrounding the approval or ban of a Bitcoin ETF rages on, the efforts of the executives are looking at an alternative method to provide exposure to BTC.

Bitcoin Deposit Receipts to provide access to Bitcoin Securities

The new product, Bitcoin Depositary Receipts (BTC DRs), works similarly to US Depositary Receipts, representing foreign stocks.

The innovation comes from the Receipt Depository Corporation (RDC), which plans to offer the first Bitcoin depositary receipts to international institutional investors in a transaction exempt from the registration requirements of the Securities Act of 1933.

RDC's BTC DRs aim to provide institutional access to Bitcoin securities through Depository Trust Co. by facilitating direct ownership in the US regulated market infrastructure and clearing in the US clearing process. is to provide through.

RDC founder and CEO Ankit Mehta, formerly of Citigroup, touted the platform's role as a tool of exchange for hedge funds, family offices, corporations and large institutional investors, allowing bitcoin to become a DTC-eligible security.

The operational infrastructure includes Broadridge Corporate Solutions as a transfer agent and Anchorage Digital Bank National Association as Bitcoin's custodian.

Backed by investors such as Franklin Templeton, BTG and Broadhaven Ventures, RDC will position the offering as a complement to Bitcoin ETFs, pending approval from the US Securities and Exchange Commission.

Mehta and co-founders Bryant Kim and Ishan Narain previously worked in Citi's depository group, indicating familiarity with this financial structure before founding RDC.

This development, as Bitcoin has reached more than $45,000 for the first time in almost two years, drives growing optimism regarding the potential approval of the SEC's potential direct-investment Bitcoin ETFs.

Approval of Bitcoin ETFs

Bitcoin Depositary Receipts provide eligible institutions with direct ownership of Bitcoin, separate from cash-held BTC ETFs. Meanwhile, spot Bitcoin ETF approvals have become a focal point in the cryptocurrency market as new year trading activity ramps up.

According to Bloomberg ETF analyst Eric Balchunas, if a Bitcoin ETF is rejected somewhere this month, it will be due to the Securities and Exchange Commission seeking more time rather than an outright rejection.

While the chances of approval may be slim, the SEC's decision is likely to prompt further review rather than derail the concept.