Bitwise Moves to Launch Spot Aptos ETF as Price Surges

Tags: aptos, bitwise, etf

Key Takeaways:

• Bitwise has filed an S-1 application with the SEC to launch a spot Aptos ETF.
• This move is part of Bitwise’s strategy to expand its ETF offerings beyond Bitcoin and Ethereum.
• Investors reacted positively to the news, driving APT’s price up significantly upon the announcement.

Demand for a spot APT product has reached new heights with crypto asset manager Bitwise being the latest company to file an application with the U.S. Securities and Exchange Commission (SEC) to list a spot Aptos (APT) exchange-traded fund (ETF). Announced on March 5th, this is a major leap toward mainstream investment access for Aptos, a newer layer-1 blockchain. Aptos, created by former facebook (now Meta) employees Mo Shaikh and Avery Ching, had once been touted as a “Solana killer.”

Is Bitwise’s Aptos ETF Filing a Tactical Play?

This follows Bitwise’s February 28th registration of a trust related to the Aptos ETF in Delaware, signaling their strong interest in this product. Aptos ETF is unique as Bitwise has been looking to launch ETFs for major cryptos including Bitcoin (BTC), Ether (ETH), Solana (SOL), XRP, and Dogecoin (DOGE).

Aptos is currently at a much earlier stage, ranking as the 36th largest cryptocurrency by market cap at $3.8 billion, according to CoinGecko, compared to the other cryptocurrencies Bitwise is targeting. This raises an important question: why Aptos?

One theory is that Bitwise believes in the long-term potential of Aptos’s technology and ecosystem. Backed by its parallel execution engine, Block-STM, Aptos can reach a transaction speed of over 130,000 transactions per second (TPS) at a low cost.

It has the potential to become the foundation for scalable blockchain solutions in the future.

Another potential factor is Bitwise’s existing familiarity with Aptos. Last November, they also recently launched an Aptos Staking ETP (Exchange Traded Product) on Switzerland’s SIX Swiss Exchange with a staking yield of 4.7%.

This existing connection could give Bitwise an advantage in navigating the complexities of launching an Aptos-based ETF in the U.S.

For example, 21Shares launched an Aptos Staking ETP on both Euronext Amsterdam and Euronext Paris.

Technicals: The Technology Behind the Aptos Blockchain

However, to properly understand what an Aptos ETF would mean, we must dive deeper into the underlying technology that powers the Aptos blockchain. While many prior blockchains process transactions in sequence, Aptos employs a parallelization engine—Block-STM. This parallelization engine allows transactions to be processed simultaneously, increasing the network’s throughput.

According to the Aptos team, this architecture allows the network to perform more than 130,000 transactions per second (TPS) with low-cost transactions. If accurate, this would position Aptos as one of the speediest and most scalable blockchains to date.

This is significant because, as blockchain technology becomes more mainstream, it needs to support an extensive number of transactions at a low cost in a short amount of time.

Aptos is developed using Move — the same programming language that was developed by Meta for the Diem project. Move has been designed with security and resource management in mind, preventing common vulnerabilities that have affected other smart contract platforms. Move is designed to make smart contracts further secure by keeping resources very tightly controlled.

These technological benefits are at the core of Aptos’s promise as a decentralized applications (dApps) and Web3 development platform. If Aptos lives up to its promise of scalability and security, it may well attract a number of developers and users, further enhancing the growth of its ecosystem.

Aptos Blockchain-Ecosystem and Partnerships

An active ecosystem is critical for any blockchain solution to be successful. Aptos is aggressively building partnerships and developing new projects. A prominent partnership is with Circle, which issues the USDC stablecoin. This integration simplifies how users access and use stablecoin within the Aptos community.

Aptos has also witnessed a growing number of DeFi applications emerge within its ecosystem, including projects like DEXs, lending platforms, and yield aggregators. These programs aim to provide a variety of financial services available to users online in a permissionless, decentralized, and transparent way.

Hurdles Ahead: The SEC Approval Process

The S-1 filing is only the initial phase of a potential multi-month approval process. Bitwise must also file a 19b-4 form for its Aptos ETF application. The SEC is then given 240 days to either approve it, deny it, or ask for more information. Note that the securities regulator’s decisions have a considerable amount of uncertainty.

Bitwise begins the regulatory process for a potential Aptos ETF. Source: Aptos

“The SEC’s decision on the Aptos ETF will be closely watched because it has the potential to set an important precedent for subsequent altcoin ETFs in the U.S.”, reported by News Room on March 06, 2025.

Considerations for Staking and Custody

Bitwise, however, has opted to exclude a staking provision in the Aptos ETF to address regulatory concerns about potential risks to the underlying asset. Staking, in which users earn rewards for holding and “staking” their cryptocurrency rather than selling it, can add complications to ETF structures and raise concerns with the SEC.

The spot Aptos ETF has listed Coinbase Custody as its proposed custodian, which is a trusted name in the industry with expertise in managing digital assets for institutional clients.

Market Response: Rise in APT Price

The APT price surged immediately following Bitwise’s Aptos ETF application, gaining more than 18% in a day and reaching $6.48. This points to investor interest surrounding potential future access to be gained via a regulated investment vehicle for Aptos.

This kind of price movement reflects a critical belief of the market: If an ETF were to be listed, it would give APT broader exposure and attract a wider base of investors including institutional players who might have previously been hesitant to invest directly in cryptocurrency.

The Larger Trend: Passing of Bitcoin to Altcoin ETFs

The filing from Bitwise for an Aptos ETF follows a trend of rising interest in altcoin-ETFs. With the cryptocurrency market maturing, investors are seeking diversification opportunities beyond Bitcoin and Ethereum. Companies such as Bitwise and Canary Capital are pushing back against this by trying to create ETFs for a broader slate of digital assets.

Still, SEC approval remains a major barrier. The agency has traditionally been wary of approving cryptocurrency-based investment products, due to concerns regarding volatility, custody and market manipulation. The market for altcoin ETFs is likely to become more favorable as regulatory clarity improves and the industry matures.

What is the Synthesis of an Approved Aptos ETF

The SEC approval of Bitwise`s Aptos ETF may have many implications, including:

• Wider Adoption: An ETF would provide Aptos with broader accessibility to retail and institutional investors, thereby driving wider use of the Aptos blockchain and its native token.
• Price Discovery: There are arguments for why the advent of an ETF would be good for APT, primarily because it could act as a market maker and contribute to price discovery.
• Aptos Validation: Approval of an Aptos ETF would be a strong vote of confidence in the Aptos network, reinforcing and expanding positive perception in the competitive blockchain landscape.
• Precedent for Other Altcoins: With a successful Aptos ETF event, it could create a pathway for more altcoins to follow suit in getting the green light for their ETFs, helping integrate digital assets further within traditional finance.

Conclusion

The move to introduce a spot Aptos ETF from Bitwise could mark a significant moment in the evolution of the cryptocurrency market. As of June 2024, the SEC had yet to confirm its decision. Should this ETF be approved, it would mark a potential milestone in the path towards mainstream adoption of altcoins in traditional financial markets. If the ETF is approved, it could signal a change in the wider acceptance of various blockchain technologies in the investment sphere.

If approved, it could unlock new opportunities for the project, enhancing price discovery, further adoption, and highlighting the Aptos ecosystem even more before the eyes of the public. Nonetheless, the world of cryptocurrency regulation is a fast-moving one, and the SEC’s formal position is still a long way off.

So, the Bitwise Aptos ETF might be a potentially major twist, but bear in mind you are reading this based on information until June 2024, so it might have been slightly different by now. Your investment decisions should be based on your own research and assessment of current market conditions and regulatory developments.