The US Securities and Exchange Commission (SEC), which opened the Bitcoin ETF proposal submitted by VanEck, has announced that discussion and decision on it will be delayed until June 2021.
What can a Bitcoin ETF offer?
As of now, Grayscale has a virtual monopoly of the Bitcoin Fund, with its product Grayscale Bitcoin Trust, regarding institutional funds that are indirectly invested in cryptocurrencies.
The “Grayscale Bitcoin Trust” is used by institutions usually for various regulatory reasons rather than buying Bitcoin directly, and the “GBTC” is usually priced at a premium compared to the real bitcoin price.
The approval of the Bitcoin ETF will provide a more stable alternative to the "Grayscale Bitcoin Trust" and potentially large amounts of institutional wealth will flow into the new SEC-approved Bitcoin ETF.
Since ETFs are traditional structured financing offerings, they will be available on very popular trading platforms.
This is likely to be a massive increase in demand in the medium term and will enable a new world of retail traders to access the cryptocurrency markets, especially those who are having trouble dealing with digital technology.
Besides being able to obtain bitcoin through popular trading platforms, a Bitcoin ETF is likely to be very popular with organizations given that the regulatory framework and tax strategy the government uses with the ETF is much clearer.
Meaning that institutions will not have to worry about issues like guarding and storage since the Bitcoin ETF provider will provide this service, and the ETF will only track the price and index of the cryptocurrency rather than being directly redeemable against a real bitcoin on the Bitcoin network.
Unfortunately, it postponed the Securities and Exchange Commission (SEC) again propose "VanEck" private b ETF Alpetkoan ..
History of the SEC with the Bitcoin ETF:
So far, the SEC has rejected or delayed bitcoin ETF requests.
None of them have been approved in the USA.
Several years ago, one of the oldest bitcoin ETF rejections caused the bitcoin price to drop more than 10% to under $ 900.
But now the cryptocurrency market has matured, becoming much larger and relatively stable, as the subsequent rejection of the ETF has not caused significant declines and volumes.
In fact, it appears that cryptocurrency investors have decided to ignore the ETF news, as it has proven irrelevant time and time again, as we saw with JP Morgan previously.
Currently there are still many Bitcoin ETF proposals filed with the SEC from companies such as "Galaxy Digital" and "Goldman Sachs".
The review process is done by the Trading and Markets Department of the Securities and Exchange Commission.
Analysts speculate that it will take one word from above (that is, from an SEC commissioner) to approve a bitcoin ETF.
But now more delays can be expected.
It is worth noting that although every decision of the Securities and Exchange Commission is considered rejected so far, we have witnessed a clear increase in the number of legacy financial institutions participating and depositing Bitcoin ETF credentials.