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At first glance this sounds like bad news, as the second US Financial Services firm has withdrawn their bid to create an exchange traded fund based on futures contracts related to Bitcoin (and other virtual currencies).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.
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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.
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Correct, ETF's are good news!
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agree..
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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.
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I guess there is marketing value in a crypto ETF, but there's also the issue of naked short selling, no?
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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.
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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!
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@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?
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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.
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Any derivative-driven product is BAD news for investors.
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good very positive news.
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They can hold back now but they wont stop crypto to replace our the existing financial currency.
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BOOOOOOOOOOOOO!!!!!!!!!!
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This is crazy don't no way to fall in but it's not cool 🤗
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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.
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Mucho Ado
Yes, doesn't seem like derivative markets will be good for Bitcoin or Crypto. Just another way for banksters to exert control over assets that they don't own.
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Thanks for sharing your important information.
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Any publicity is good publicity in my opinion :)
Remember when the "wannacry" ransomware was rampaging about and all of the news channels were talking about Bitcoin- My theory is that they didn't do it for the ransom money alone (which was only around $100,000 or so in total), they did it to bring publicity to Bitcoin and have everyone asking what it is...
The price of Bitcoin went on a serious rally in the months following all of those ransomware attacks COINCIDENTALLY :) They had way more to gain by drawing attention to Bitcoin, rather than from the ransoms themselves.
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You have a lot of awesome posts, but this is by far one of your best ones man. I needed this one today! Thanks.
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Well & good information keep it up
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Good! I'm all in favor of mainstream adoption of crypto, but I fear that something like this would only benefit a handful of bankers. I'd also worry that they could very easily crash the market, causing a lot of people to get burned while they profit.
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Nyc post please upvote and follow me then i also upvote you
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Thanks for sharing the details with us. Headline skimming to get news of any kind is only as accurate as the understanding (and honesty) of the person composing said headline.
Seems like it makes sense to get the derivatives markets up and running first before moving forward on the ETF. But what do I know? :)
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This is but, natural. A consequence of decentralization and blockchain. Governments will start losing more and more control over the economy. They will have to come up with new ways to generate revenue. Hence all these new regulations and bans.
Would love to hear your thoughts @jrcornel
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Good post! I'm going to follow you to see more post like this and for support us!
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Makes logical sense. Appreciate the info as it is helpful!
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great post , keep the good work
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Great post. While derivatives can be a complex subject, I think the general notion of having EFT's that track (contain) crypto's is an excellent idea.
EFT's would give crypto's wide spread adoption and give governments their tax revenues and some measure of control. It is also hard to make something illegal when everyone has their finger in the pie. I am glad that the story was a nothingburger.
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Nice post n info... Upvote. Please help comment@hadimemories. Thanks
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Many people want to try and fit cryptocurrencies into there own world whether it be stocks physical tokens symbols or whatnot. The reality of the situation is that these currencies have now created there own real/world. The world only consists of numbers governed by block-chains. It totally revolves around a mathematical system. Instead of people trying to move this industry into the real world they should first consider jumping into the crypto world. You want bitcoin? Get it from coinbase/gdax and cut out the middle man.
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Not entirely true, if these financial products were NOT offered by a broker-dealer, yes it is true SEC clamp down, but if the ETF is offered by a registered broker-dealer they have the blessing of the SEC. This is what ANKORUS is doing with their new ANK tokens. As registered broker dealers, offering a token to swap between crypto and stocks, bonds, treasuries. ankorus.org
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Saw your message in my wallet, what did you want to talk to me about?
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