Tag: BITCOIN SPOT ETF

2024 Election Impact on SEC’s Bitcoin Spot ETF Approval

by Blockchain News

The stance of the United States Securities and Exchange Commission (SEC) on Bitcoin spot ETFs has been the subject of extensive debate and speculation. John Reed Stark, who serves as the President of John Reed Stark Consulting LLC and was previously the Chief of the SEC Office of Internet Enforcement, has carried out an analysis on Twitter. His findings suggest that the 2024 U.S. Presidential Election could represent a pivotal moment in shaping the SEC’s policy towards Bitcoin spot ETFs.

Position of the SEC Right Now

According to the insights that Stark divulged on the 13th of August 2023, it is very improbable that the present SEC would accept any Bitcoin spot ETF applications. He provides strong reasons, such as worries about market manipulation and the susceptibility of planned spot bitcoin-based exchange-traded products (ETPs). These concerns were also brought up by the independent analysts working for Better Markets in their comment letters submitted to the SEC on August 8th, 2023.

The Increasing Partisanship about Crypto Regulation at the SEC Stark draws attention to the growing partisanship about crypto regulation at the SEC. Although cryptocurrency was formerly considered a non-partisan subject, it has recently become a point of contention, particularly inside the SEC.

Impact of the 2024 Election

The approach that the SEC takes towards Bitcoin spot ETFs may undergo a fundamental adjustment after the presidential election in the United States in 2024. Stark is of the opinion that the SEC would most likely take the following actions in the event that a Republican is elected president:

Reduce dramatically the amount of effort it puts towards crypto-enforcement and concentrate primarily on fighting fraud cases.

Increase your openness to the idea of authorising a Bitcoin spot ETF and pursuing other regulatory moves that are favourable to cryptocurrencies.

This trend may be further influenced by the possibility that “crypto-mom” Hester Peirce may be appointed as interim Chair of the Securities and Exchange Commission. Stark thinks that most crypto-related enforcement might come to a standstill under Peirce’s leadership at the United States Securities and Exchange Commission (SEC).

Conclusion

The 2024 U.S. Presidential Election could be a pivotal moment for the future of Bitcoin spot ETFs. The outcome may determine whether the SEC continues its current cautious approach or adopts a more crypto-friendly stance.

John Reed Stark’s analysis provides valuable insights into the complex interplay between political dynamics and financial regulation. As the 2024 election approaches, the crypto community and investors will be closely watching for signs of how the political landscape might shape the SEC’s decisions on Bitcoin spot ETFs.

Image source: Shutterstock

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Proshares Bitcoin futures fund in top 2% of all ETFs for volume

by Cointelegraph

Since its launch on Oct. 19 Proshares’ Bitcoin futures exchange-traded fund (ETF) has been a popular choice with traders, rising to the top 2% of all ETFs in terms of total trading volume.

Bloomberg’s Senior ETF analyst Eric Balchunas noted on Nov. 11 that the ProShares Bitcoin Strategy ETF (BITO) had $400 million worth of shares traded yesterday, with its average volume consistently putting it in the top 2% of all ETFs.

BITO has seen roughly $112.79 million combined inflows over the past nine days. While the figure pales in comparison to the first two days of the fund’s listing that saw $567.16 million and $489.51 million worth of inflows each, Baluchunas noted that “this kind of consistent flow-age is highly rare” for a newly launched ETF.

BITO launched on the New York Stock Exchange on Oct. 19 and has since accumulated more than $1.4 billion worth of assets under management (AUM). Investor appetite for the fund remains high although the price of BITO has failed to surge and is currently sitting at $42.3, which is slightly below its initial listing price around $43.2.g. Balchunas suggested that options volume may be the driving factor behind BITO at this stage.

There seems little hope of a Bitcoin ETF tracking the spot price being approved in the immediate future, with Balchunas suggesting that VanEck’s spot ETF would almost certainly be knocked back by the U.S. Securities and Exchange Commission (SEC) on the Nov. 14 deadline. The analyst put the odds at a “bleak” 200-1.

Related: BREAKING: BlockFi files for physically-backed Bitcoin ETF

On Nov. 10, ProShares investment strategist Leks Gerlak told U.S. News & World Report that BITO should have no issues with reflecting the value of Bitcoin as futures contracts play a key role in determining its spot value:

“There is no single reference price for Bitcoin, and the trading price of Bitcoin varies from one exchange to another, often between 1% to 2%, and sometimes by 4% to 5%. Expert research on this topic finds that the Bitcoin futures market dominates the price discovery process.”

“Over the past few years, Bitcoin futures and Bitcoin have historically provided very similar returns. Both correlation and beta have been very close to one to Bitcoin,” he added.