The SEC is requesting withdrawal of Bitcoin derivatives ETFs
However, it's not nearly as dire as it might seem upon first glance!
At first glance this sounds like bad news, as the second US Financial Services firm has withdrawn their bid to create an exchange traded fund based on futures contracts related to Bitcoin (and other virtual currencies).
It sounds even worse when you find out that this withdrawal appears to be at the request of the SEC.
However, things are not quite as dire as the doom and gloomers might have you believe.
You see, the SEC is requesting these withdrawals simply because these ETFs are trying to be tied to something that technically isn't even trading yet.
Derivatives markets don't even technically exist yet.
So, the SEC merely is asking these firms to wait until Bitcoin derivatives markets are actually up and trading before making a request to have an ETF tied to them.
That's it, that's the only reason for the SEC's request.
The official release can be seen here:
"The Trust notes that on a call with the Staff, the Staff expressed the view that it is the Commission’s policy not to review a registration statement for a fund where the underlying instruments in which the fund intends to primarily invest are not yet available. The Staff requested that the Trust withdraw Amendment No. 47 until such time as the underlying instruments in which the Funds intend to invest (i.e., bitcoin futures contracts) become available for investment."
The SEC doesn't want to review something tied to something that technically doesn't even exist yet.
Much ado about nothing.
There you have it.
It's not that the SEC doesn't want Bitcoin related ETFs that are tied to derivatives markets, it's that the SEC doesn't want Bitcoin related ETFs tied to derivatives markets BEFORE there is even a derivatives market in the first place.
Which sounds perfectly logical to me.
Anyone trying to spin this latest news as anything but a non-event hasn't really read all the details just yet.
Stay informed my friends.
Sources:
https://www.coindesk.com/sec-pushes-back-bitcoin-derivatives-etfs/
Image Sources:
https://news.bitcoin.com/sec-rejects-rule-change-for-bitcoin-etf/
http://theatreanddance.arts.usf.edu/content/templates/?z=10&a=4658
Follow me: @jrcornel
To tell you the truth, I don't think cryptocurrencies need these ETFs. Instead of liquidity going directly to the exchanges where the real cryptos are trading, we want the liquidity to funnel in to these fake instruments? Why?
The moonkids and pumpers have convinced themselves that having a Bitcoin ETF is somehow going to bring in more institutional money in, but these derivatives go directly against the ethos of whole crypto movement.
Good point. An ETF tied to Bitcoin (or another cryptocurrency) would be much more beneficial as the ETF would have an inventory of the underlying.
Correct, ETF's are good news!
agree..
I tend to agree, but I also see the value in having ETFs simply for the awareness factor. If you buy an instrument you're likely to research it further. My hope would be that a decent portion of BTC ETF buyers would perform more due diligence and realize there's a whole other world out there in crypto.
I guess there is marketing value in a crypto ETF, but there's also the issue of naked short selling, no?
The main benefit to having an ETF is that it legitimizes Bitcoin for the mainstream investors. I knows tons of people who simply do not trust Bitcoin because there is nothing backing it but investor confidence and mathematics :-D I tell them that is why they SHOULD trust it, not the manipulated stock markets and precious metals markets which are controlled by the useless dollar.
In order for the blue-hair investors to jump on board there needs to be wider adoption and the ETF would bring that to the masses.
Thanks for the guide. I have watched some videos on this topic at YouTube recently. People hear about something and do their analysis without digging deep in the matter. It's a pleasure that people like you are around for the right analysis. Appreciate it. Great post like all your other posts.
Stay awesome @jrcornel.
Steem On!
@jrcornel, I'm 200% agreed with your statement:
The SEC merely is asking these firms to wait until Bitcoin derivatives markets are actually up and trading before making a request to have an ETF tied to them.
I'm very happy to see you active and getting common people some useful awareness regarding Cryptocurrency. Your words created a hope to small investors like me. Keep sharing more content to get more awareness on Cryptocurrency. Stay blessed.
By the way can you give me your feedback on IOTA?
Or you can just hide your internet presence, move them into a paper wallet, store that paper wallet somewhere it will not be found, wait five years, go on holiday in a place with crypto ATMs, launder the shit out of your intelligently-gotten gains and not ever have to care what the SEC thinks or says ever again.
Any derivative-driven product is BAD news for investors.
good very positive news.
They can hold back now but they wont stop crypto to replace our the existing financial currency.
BOOOOOOOOOOOOO!!!!!!!!!!
This is crazy don't no way to fall in but it's not cool 🤗
SEC Has a downhill fight. Isnt spending money a protected type of speech now. Supreme court. Expression threw creation of value. They just dont know what to do yet.