Markets are holding out for hope that the SEC could approve an exchange-traded fund based on Bitcoin from CBOE called VanEck-SolidX after the institution announced that it would hold its judgment until it could collect more data on public opinion of such an instrument.
“Institution of such proceedings is appropriate at this time in view of the legal and policy issues raised by the proposed rule change. Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved. Rather, as described below, the Commission seeks and encourages interested persons to provide comments on the proposed rule change,” wrote Brent Fields, a secretary for the SEC, in a public memorandum.
This decision by the regulator may have also been one of the reasons why the cryptocurrency market has been experiencing a bullish moment for the last 24 hours, as traders are optimistic that the SEC will eventually come to a public decision. Bitcoin’s rise was perhaps among the smallest, but it still grew by 4% in only the last day.
In that case, the anticipation surrounding this moment is unusually optimistic, considering the fact that not everyone is on board with the existence of a Bitcoin ETF.
Andreas Antonopoulos, a teaching fellow at the University of Nicosia and a major Bitcoin advocate, considers that this kind of prospect could open the doors to more manipulation. In addition to this, he believes that more detached investment into Bitcoin-based funds could remove holders from the voting rights that the community benefits from through software adoption and running nodes.
“I can choose which exchanges to send my Bitcoin to, if I want to send it to an exchange… If there is ever a fork debate—which is very likely to happen again in any cryptocurrency—then the funds that control Bitcoin now have a very large voice. Their shareholders don’t. They don’t get to chose which fork the fund is going to follow in a Bitcoin debate,” he said.
While there is a lot of excitement from investors about the potential approval of an ETF, the SEC still hasn’t made its decision and there may yet be a long way to go before approval. We might even end up waiting until the end of the year, just like we did with futures contracts.