Regulatory uncertainty could fuel further delays in the approval of highly anticipated ETF Bitcoin products.
Over 20 Bitcoin ETFs Still Awaiting Approval
Bitcoin Fans May Have To Wait Longer For A Bitcoin Futures ETF say the director of research firm CFRA Todd Rosenbluth.
Rosenbluth said that while a Bitcoin futures product will likely be the first crypto ETF to receive approval, he expects the rather vague regulation could cause further delays. There are now over 20 crypto ETFs awaiting SEC approval. The regulator has not yet approved one and continues to postpone decisions.
The researcher suggested that regulators probably want to wait until they can approve all applications at the same time in order to get a
“It is possible – in fact, we think it is likely – that we will see a slowdown in a Bitcoin futures ETF until 2022, until the regulation is clearer.”
‘SEC must gain more control over crypto trading’
Jan van Eck, CEO of VanEck, noted that the biggest concern for the SEC is the difference between the actual Bitcoin prices and the price of the futures contract, in addition to the potential for funds to grow too large. When there is a Bitcoin rally, futures can lag as much as 20% per year, he said. He further added:
“the SEC wants some insight into the underlying Bitcoin markets.”
Van Eck also suggested that the regulator should gain more control over crypto trading. The regulator already seems to be trying to do this with its recent indictment against Coinbase and the exchange’s stablecoin lending product. Other popular trading platforms like Robinhood are already regulated and registered as broker-dealers.
How will this affect the BTC price?
Any speculation about a possible slowdown could hurt Bitcoin price. A large number of analysts expect that another Bitcoin ETF will be approved this month. Partly because of these expectations, the price has risen by 37.5% in the past two weeks to reach a local high of $58,000 on October 12. However, further delays in regulation could threaten the current market momentum.
Eric Balchunas, senior ETF analyst at Bloomberg, is still confident. He says there is a 75% chance that an ETF will be approved this month. Earlier this month, the SEC extended the deadline of four BTC ETFs by 45 days. These were the Global X Bitcoin Trust, Valkyrie XBTO Bitcoin Futures Fund, WisdomTree Bitcoin Trust and Kryptoin Bitcoin ETF.
In September, Van Eck’s physically-backed Bitcoin ETF was delayed for the second time this year. The decision date was set by the SEC as Nov. 14.