A Bitcoin ETF has been the holy grail of crypto bulls ever since the cryptocurrency broke onto the big stage. With the SEC’s latest decision, its approval may have just become a bit more likely.
SEC approves ETF with indirect BTC exposure
The Volt Crypto Industry Revolution and Tech ETF was filed on October 1 and will track the performance of publicly listed companies with a majority of their assets in bitcoin, or companies that make a majority of their profits through mining or building mining equipment. Michael Saylor’s MicroStrategy is an example of the former, while Marathon Digital Holdings would be an example of the latter. This was approved by the Securities and Exchanges Commission, which is traditionally hesitant about cryptocurrency investments.
The fund’s net assets will be 80% in crypto stocks and 20% in traditional stocks to balance the portfolio risk. Direct exposure to cryptocurrencies is not included.
Is a bitcoin ETF coming closer?
The approval of BTCR, as it will be traded under, comes four days after a renewed delay of the SEC decision on four bitcoin ETFs: GlobalX, WidsomTree, Kryptoin, and Valkyrie. BlockFi also filed for a bitcoin futures ETF, with the total number of applications now being over a dozen.
Bitcoin bulls are relishing the prospect of possible ETF approval since it could mean fresh all-time highs for the cryptocurrency. With an increasing number of applications and bitcoin-adjacent funds getting the nod, it seems that the chances for a bitcoin ETF might be improving. SEC Chairman and crypto skeptic Gary Gensler has suggested he would not necessarily oppose a futures-based bitcoin ETF. BTCR is the first bitcoin-related fund to receive the green light, although the process was anything but easy. “It was very difficult to get this through,” Park told Insider, but we’re really glad that they finally approved it,” said CEO Tad Park in an interview.
Quo vadis, Australia?
With a bitcoin ETF looking like a real possibility, countries like Australia, which have been kicking the can down the road on cryptocurrency regulation, are risking getting left behind. Approvals to funds like those of Mike Novogratz and Neuberger Berman would mean a fresh influx of money into the booking cryptocurrency space. With it comes a push in new products being developed and more mainstream awareness and demand for real-world applications of cryptocurrencies. And while the U.S. still seems torn on the benefits and downsides of crypto regulation, Australia is a step behind.
The local blockchain sector has long been calling for regulatory clarity and better communication from the public sector, but new talks are only scheduled for 2022. Crypto startups risk being “de-banked” due to the lack of rules that give banks higher ground. With current developments in the U.S. in mind, this is a dangerous game to play. If Australia does not clean up its act on crypto regulation quickly, it risks losing appeal for innovators and disruptors in the Asia-Pacific region. Those same bright minds may choose to head for more crypto-friendly places instead, something the U.S. might still become if ETFs become reality.