The cryptocurrency community is eagerly awaiting the decision of the US Securities and Exchange Commission (SEC) on whether to approve the first Bitcoin exchange-traded fund (ETF) in the country. According to a report by Fox Business, the SEC has given guidance that a Bitcoin ETF will be approved by January 10, 2022, the deadline for the agency to review several applications.
A Bitcoin ETF is a type of investment product that tracks the price of Bitcoin and allows investors to buy and sell shares of the fund without having to deal with the complexities of owning and storing the digital asset. A Bitcoin ETF would provide more liquidity, transparency and regulatory oversight to the market, as well as lower fees and barriers to entry for investors.
The approval of a Bitcoin ETF in the US would be a major milestone for the cryptocurrency industry, as it would signal the growing acceptance and legitimacy of Bitcoin as an asset class. It would also likely boost the demand and price of Bitcoin, as more institutional and retail investors would have access to the fund.
Tekedia Mini-MBA edition 14 (June 3 – Sept 2, 2024) begins registrations; get massive discounts with early registration here.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
However, the SEC has been reluctant to approve a Bitcoin ETF in the past, citing concerns over market manipulation, fraud, custody and investor protection. The SEC has rejected several proposals for a Bitcoin ETF since 2013, and has delayed its decision on the current batch of applications several times.
The report by Fox Business claims that the SEC has given guidance to some of the applicants that they are likely to approve a Bitcoin ETF by January 10, as long as they meet certain conditions. These include using futures contracts rather than spot prices to track Bitcoin, having adequate liquidity and capital reserves, and complying with anti-money laundering and other rules.
The report also suggests that the SEC may approve more than one Bitcoin ETF, creating competition and choice for investors. Some of the leading contenders for a Bitcoin ETF approval include Valkyrie Investments, VanEck, ProShares, Invesco and Galaxy Digital.
Satoshi Nakamoto is the pseudonym of the mysterious creator of Bitcoin, the first and most popular cryptocurrency. Bitcoin was launched in 2009, after Nakamoto published a white paper describing the protocol and the vision behind it. Nakamoto’s identity remains unknown, but his or her legacy is undeniable.
Bitcoin has revolutionized the way people transact value online, without intermediaries or central authorities. It has also inspired thousands of other cryptocurrencies and blockchain projects, some of which aim to improve or challenge Bitcoin’s dominance.
Nakamoto’s innovation has opened up new possibilities for finance and technology, as well as social and political implications. In this blog post, we will explore some of the aspects of Nakamoto’s legacy and how they have shaped the world we live in today.
While the report by Fox Business is optimistic, it is not an official confirmation from the SEC, and there is still a possibility that the agency may deny or postpone its decision on a Bitcoin ETF. The SEC has not commented on the report or its plans for a Bitcoin ETF approval.
Therefore, investors should exercise caution and do their own research before investing in any cryptocurrency-related products. A Bitcoin ETF may be a game-changer for the industry, but it is not a guarantee of success or profitability.
BlackRock just filed an updated Bitcoin ETF application after SEC had a big day of meetings with all of the issuers
Meanwhile, BlackRock, the world’s largest asset manager, has submitted a revised application for a Bitcoin exchange-traded fund (ETF) to the U.S. Securities and Exchange Commission (SEC). This comes after the SEC held a series of meetings with various ETF issuers yesterday, signaling a possible breakthrough in the long-awaited approval of Bitcoin ETFs.
In its filing, BlackRock proposed to launch the BlackRock Bitcoin Futures Trust, which would invest in cash-settled Bitcoin futures contracts traded on registered commodity exchanges. The trust would not invest directly in Bitcoin or other cryptocurrencies. The filing also stated that the trust would use the CME CF Bitcoin Reference Rate as its benchmark index, which is based on the aggregated trade flow of major Bitcoin spot exchanges.
BlackRock is not the only ETF issuer that is vying for the SEC’s green light. According to Bloomberg, there are at least 20 other Bitcoin ETF applications pending before the regulator, including those from VanEck, WisdomTree, Fidelity, and Valkyrie. Some of these issuers have also filed for ETFs that would invest in Bitcoin futures contracts, while others have proposed to hold physical Bitcoin or use a combination of both.
The SEC has been reluctant to approve any Bitcoin ETFs so far, citing concerns over market manipulation, investor protection, and regulatory oversight. However, some industry observers believe that the tide may be turning in favor of Bitcoin ETFs, as the SEC has recently appointed several crypto-friendly officials, such as Gary Gensler as the new chairman and Hester Peirce as a commissioner. Peirce, who is known as “Crypto Mom” for her pro-crypto stance, has repeatedly advocated for a more flexible and innovation-friendly approach to regulating crypto assets.
The approval of a Bitcoin ETF in the U.S. could have a significant impact on the crypto market, as it would provide an easier and more accessible way for institutional and retail investors to gain exposure to Bitcoin. It could also boost the price and liquidity of Bitcoin, as well as enhance its legitimacy and adoption as an alternative asset class. Some analysts have estimated that a Bitcoin ETF could attract billions of dollars in inflows in its first year of operation.
However, there is no guarantee that the SEC will approve any Bitcoin ETFs anytime soon, as it still has the authority to delay or reject any applications. The SEC has already postponed its decision on VanEck’s Bitcoin ETF until June 17, and it could extend the review period for up to 240 days. Moreover, the SEC could impose strict conditions or limitations on any approved Bitcoin ETFs, such as requiring high fees, imposing trading restrictions, or mandating enhanced disclosures.
Therefore, investors who are interested in Bitcoin ETFs should exercise caution and patience, as well as conduct their own due diligence before investing. While a Bitcoin ETF may offer some advantages over other ways of investing in Bitcoin, such as lower costs, higher security, and tax efficiency, it may also entail some risks and challenges, such as regulatory uncertainty, market volatility, and operational complexity.