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The first bitcoin-ETF in Europe is expected to be registered. Major companies have submitted requests to the SEC. The regulator’s decision will influence the market. Shares of cryptocurrency companies rose. Bitcoin has surpassed $31,000. Bitcoin-ETF is an important step towards institutional adoption.
The first bitcoin-based ETF in Europe is expected to be registered in July. The UK-based company Jacobi Asset Management planned to launch a bitcoin ETF last year, but then the procedure was delayed for 12 months, and is now ready to resume. In the summer of 2022, the largest crypto exchanges collapsed: Terra, FTX, etc., so that time the company considered it inappropriate. This is a landmark event in the crypto industry, bitcoin-ETF will be launched on Euronext Amsterdam exchange under the ticker BCOIN.
Over the past few weeks, the market has seen a boom in demand for spot ETFs tied to the first cryptocurrency. Some of the largest companies, such as BlackRock, Valkyrie, Fidelity Investments, WisdomTree and Invesco, have filed inquiries with the SEC regarding these ETFs.
What the new investment document means, we will consider in this article.
It is known that there are ETFs for bonds, world currencies, gold, real estate and oil, which have been on the market for several decades. For example, the SPDR S&P 500 ETF Trust, which tracks the dynamics of the S&P 500 index.
In the summer of 2023, BlackRock, Valkyrie, Fidelity Investments, WisdomTree, and Invesco, again submitted revised requests to the SEC. The SEC initially rejected the initiative, citing a lack of information about the joint surveillance agreement and its technical details . But the companies supplemented their filings and resubmitted the necessary documents to the SEC.
The regulator’s decision is eagerly awaited by the market and has a significant impact on the future of the industry. After the news of the ETF’s creation, the share prices of Coinbase, MicroStrategy, Riot Blockchain and Marathon Digital Holdings all rose strongly, with all of them seeing double-digit growth. Oh, and bitcoin itself has crossed the $31,000 threshold.
Michael Saylor, founder of MicroStrategy, called ETFs tied to the original cryptocurrency a crucial step toward institutional adoption.
But will the approval of the cryptocurrency instrument take cryptocurrency out of the bear market for good? Experts say there’s no need to bet on a sharp jump in quotes.
Yes, institutional money has been waiting for about 5-6 years, hence the deceptive prospects, especially in the matter of the rate of Bitcoin and other cryptocurrencies. But their arrival doesn’t mean at all that prices will skyrocket. What will become more stable is the regulatory environment in the digital sector.
The emergence of spot ETFs will help reduce the rise of OTC products like GBTC, which are expensive and inefficient. as well as reduce the pressure on assets for large purchases or sales.
Grayscale CEO Michael Sonnenschein sees the transition of bitcoin trusts into ETFs as a key priority.
In turn, the SEC is not ready to take on more responsibility without clear regulations to ensure safety for investors.
So there will be requirements from the SEC to comply with anti-fraud rules, transparent operations, and reports. Few companies will be able to comply.
In general, the SEC’s decision will depend on the government’s policy on cryptocurrency regulation.
It is possible that the approval procedure will take longer than expected and will include many adjustments. However, large companies with significant influence, such as BlackRock, WisdomTree and Valkyrie, may influence politicians to support spot bitcoin-ETFs.
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