By Now that the possibility of a Bitcoin EFT is a reality, the timing of its approval is anticipated to be in 2019. This is primarily after several predictions from different quarters and recent statements have indicated that the approval will only take place next year.
The EFT approval must be granted by the US Securities and Exchange Commission. People know that the Bitcoin EFT approval is inevitable, however, they are apprehensive as to how long the approval process will take.
All About Cryptocurrency ETF
An ETF refers to any fund, such as mutual or hedge funds as examples, that are traded on a listed exchange. ETFs are predominantly trading SEC or CFTC regulated assets. However, the majority of cryptos are not recognized as SEC or CFTC regulated assets.
The implication is that a fund trading them would have to register its shareholders’ interests in the fund as securities, while the traded assets remain unregulated.
Digital assets are largely unregulated, which is considered to majorly influence the reticence of the SEC to allow its approval.
A number of applications have been submitted to SEC, seeking approval of such funds. The Winklevoss twins submitted an application in March 2017 and July 2017, both of which have been denied. This has not deterred other applicants from applying to the SEC, albeit with revised and supposedly improved details.
An Urgent Issue
In the US Equity Research document released August 05, 2018, Michael Graham CFA and Scott Suh, reported that the arrival of a potential bitcoin ETF remains at the forefront of institutional investors seeking exposure to this emerging asset class. They went on to single out the proposal by VanEck/SolidX, as the most notable among several pending applications
Despite the fact that most of the key players in the ecosystem do not see an ETF as fundamental, they do agree that it would have a significant short-term effect when it is approved. It has been proposed that the EFT may be a catalyst that the market is waiting for, prior to the predicted next phase of another bullish run.
In the US Equity Research document, the authors acknowledge how the last several weeks have brought heightened interest, with the potential approval of a bitcoin ETF. However, expectations have been lowered since the recent rejection by SEC of the second proposal by the Winklevoss twins. In their opinion, this makes an ETF approval in 2018 highly unlikely.
A Realistic Look At Approval Dates
The SEC has set a review date for September. However, considering the details of the VanEck/SolidX ETF proposal, the duo except the deadline to be postponed again. This has led to the conclusion that an approval date sometime in 2019 is more realistic.
While the speculation continues, investors and market makers are sitting patiently whilst several predictors and variables keep appearing. These predictors are causing anticipation as to the next destination of bitcoin.
The market remains apprehensive as the buck stops at SEC’s table, and the outcomes to-date have not all been favorable to the direction in which the outcome can go.
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