Bitcoin ETFs – When and How


Bitcoin’s popularity is surging up, especially now with the upcoming hard fork and the new price level it broke: $6,000. The next step for bitcoin seems logical – the launch of Bitcoin ETFs. However, the idea has been struggling and to this day, there is no approval for U.S. SEC on such a product to be initiated.

Some of the well-known failed attempt to launch Bitcoin ETFs is the  VanEck Management Group, which applied for the launch of the VanEck Vectors Bitcoin Strategy ETF, but were eventually “smashed” by SEC and the ETF never came through.

With the regulations and “doubts” presented by governments, CEOs and central banks on the viability of bitcoin, an ETF may not be coming soon. However, many believe it is all about the timing. It is not a question of “if”, but a question of “when” and “how”.

According to TheStreet, the CEO of ACSI Funds, Phil Bak, shared his opinion that it is understandable that SEC did not approve Bitcoin ETFs, since the underlying futures contracts are not yet trading.

Quoting from TheStreet: 

“If Bitcoin futures are approved for trading, an ETF tracking those futures has a significantly higher likelihood of approval than the spot based products that were rejected last year, Bak added.”  

The ETF proposed to the SEC by the Winklevoss twins was also rejected. The brothers wanted to bring bitcoin to the mainstream, but SEC rejected their application. In an article from Forbes from March, 2017, news reporter Laura Shin noted:  

“The agency noted that, to be approved, an exchange offering a bitcoin ETF would need “surveillance-sharing agreements with significant markets for trading the underlying commodity or derivatives on that commodity. And second, those markets must be regulated.” 

Expectations remain high for the launch of Bitcoin ETF, with the rise in price and trust in investors, who now seem bullish with the upcoming hard fork and the steady increase in price this year (+700%).

 

 

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Bitcoin ETFs - When and How

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