Crypto Fees Surge as Market explodes while North Korea Makes Bank From Stolen Crypto
The crypto currency sector continues to be a light with anticipation as the United States Securities & Exchange Commission (SEC) allegedly engages with crypto currency centralised exchange (CEX) regarding the approval of spot Bitcoin exchange traded funds (ETFs).
According to Bloomberg Intelligence's ETF specialist Eric Balchunas the SEC's Trading and Markets division discussed 19b-4 filings with exchanges this week sparking continued rumors and increased Crypto Hype that the regulator is leaning towards cash creates instead of crypto.
The SEC's proposition suggests that spot Bitcoin ETFs should opt for cash creates as broker dealers face limitations in dealing directly with Bitcoin. Balchunas notes that broker dealers which are the institutional players behind spot BTC ETF applications. May find it easier to transact in Bitcoin if cash creates are implemented.
This could alleviate the need for unregistered subsidiaries or third-party firms providing a smoother regulatory path for institutional players. This is something that we at Leo Finance picked up early on in the regulatory process. That the SEC was focusing on pushing Crypto investment away from the current CEX’s and towards mainstream investment bankers such as Wall St.
Balchunas highlights that only two or three filers had initially planned cash creates with the majority leaning towards in-kind transactions. The SEC's potential shift towards cash creates may lead to amendments in applications and possibly causing delays in the approval process.
Despite this Balchunas maintains a 90% probability alongside colleague James Seyffart for the SEC to approve the spot BTC ETF by January 10. This is continuing to create hype within the current Crypto markets.
Canada already there
In a related development the prospect of a spot Bitcoin ETF approval has triggered a surge in Bitcoin transaction fees On November 16 the Bitcoin blockchain recorded USD 11.6 million in fees with the average transaction fee skyrocketing by 746% from a year ago.
The increased demand for Bitcoin is attributed to the anticipation of spot BTC ETF approvals with major asset managers such as BlackRock, Fidelity, ARK Invest, and WisdomTree submitting proposals.
Bitcoin Fees Surge
Despite the surge in fees Bitcoin continues to trade near 18 month highs at USD 36,403 showcasing the impact of the ETF hype on the crypto currency's value. The SEC's engagement with firms like WisdomTree, ARK, and others indicates ongoing discussions and proposal adjustments. Bloomberg's Eric Balchunas sees these amendments as positive signs, signalling progress in the SEC's evaluation process.
As the SEC navigates the ETF approval landscape some analysts believe that a 'crypto spring' is underway marking the end of a crypto winter. ARK Invest CEO Cathie Wood notes a significant change in the SEC's approach, citing the regulator's engagement and sophisticated questions.
Wood remains bullish on spot Bitcoin ETF approval, indicating a positive shift in the odds. However, potential complications may arise if Grayscale decides to sue the SEC over issues related to the conversion of Grayscale Bitcoin Trust into a spot Bitcoin ETF.
In a broader market perspective analysts predict that the crypto currency market cap could reach USD 10 trillion. With the end of a crypto winter coupled with the potential approval of spot Bitcoin ETFs is seen as a catalyst for a new bull market cycle.
Bloomberg Intelligence analyst Jamie Coutts dismisses the notion that recent price action is solely driven by ETF news pointing to signals in Bitcoin's risk adjusted return and its correlation with global asset markets.
North Korea Makes Bank
Despite international sanctions North Korea's hacking activities including high profile heists and cyberattacks. Provides an example of the need for increased cybersecurity measures in the crypto space.
The communist nation has been at the centre of many of the cyber attacks with some anticipating that the isolated nation has managed to steal in excess of USD 8 Billion Dollars. With the majority of funds going towards the nations nuclear weapons programs which is causing instability in the region.
North Korea has already been advancing it’s ballistic missile capabilities which is causing concern in South Korea who might be the first target from the north should nuclear war break out.
As the crypto market continues to mature, addressing security concerns will be crucial to sustaining its growth and mitigating risks associated with illicit activities.
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