Investment firm Nicholas has submitted an application for a groundbreaking Bitcoin ETF that would operate exclusively outside traditional U.S. market hours. The proposed 'AfterDark' fund aims to capitalize on Bitcoin's 24/7 trading nature while addressing the gap between stock market closures and cryptocurrency volatility that occurs overnight.
In an innovative move that could reshape how investors access Bitcoin exposure, Nicholas Investment Partners has filed with the Securities and Exchange Commission for an unusual exchange-traded fund that would trade only during non-standard market hours.
The proposed AfterDark Bitcoin ETF represents a novel approach to cryptocurrency investment vehicles, specifically targeting the trading window when traditional U.S. equity markets are closed. Unlike conventional spot Bitcoin ETFs that operate during regular trading hours of 9:30 AM to 4:00 PM Eastern Time, this fund would provide exposure during evening, overnight, and pre-market sessions.
The rationale behind this unconventional structure addresses a fundamental characteristic of cryptocurrency markets: they never sleep. Bitcoin trades continuously across global exchanges, often experiencing significant price movements during U.S. overnight hours when Asian and European markets are most active. Traditional Bitcoin ETFs, constrained by stock market hours, can create a disconnect between the fund's price and Bitcoin's actual market value during extended periods of market closure.
This gap became particularly evident during major market events, such as when significant Bitcoin price swings occurred overnight, leaving U.S. investors unable to respond until markets reopened the following morning. The AfterDark ETF would theoretically allow investors to react to global developments in real-time, even when Wall Street is closed.
However, the proposal faces considerable regulatory hurdles. The SEC has traditionally been cautious about approving innovative ETF structures, particularly in the cryptocurrency space. Questions remain about liquidity, market making, and whether sufficient investor demand exists for an off-hours-only product.
Industry analysts suggest the filing reflects growing sophistication in cryptocurrency investment products. If approved, the AfterDark ETF could set a precedent for other time-segmented investment vehicles and potentially pave the way for truly 24/7 Bitcoin ETF trading in the future.
The SEC typically takes several months to review ETF applications, meaning investors likely won't see this product available until late 2025 at the earliest, assuming regulatory approval.