While the markets are in their own zone of decline, there is some news building up around the Bitcoin ETF. This time things seem to be on the positive side as the new appointment at SEC by Trump is Pro cryptocurrency. The other news that would give a positive push to cryptos is that Coinbase is considering options for Bitcoin ETF. Maybe this is the news the street was awaiting that could hold the free fall in markets.
Pro crypto appointment at SEC by Trump administration
Trump administration has made its 4th appointment to the Securities Exchange Commission in form of Elad Roisman a Republican from Maine. What was the most standout part of him was that in a hearing before the Senate Banking Committee in July, Roisman touched on what will be a series of landmark decisions on cryptocurrency made by the Commission, saying
“…the SEC must examine and re-examine its rules, regulations, and guidelines to ensure that they are still working as intended to accomplish the SEC’s mission. This is most recently manifested in areas such as data protection and cybersecurity, as well as the emergence of new investments and technologies such as initial coin offerings and blockchain. It is essential that the SEC approach these new challenges in a fair and transparent manner, provide clarity and certainty to the markets and investors, and enforce the laws and regulations that hold market participants accountable.”
With Elad Roisman’s appointment now the equation at SEC becomes interesting. The commission now looks like Chairman — Jay Clayton (I), Commissioner — Robert Jackson, Jr. (D), Commissioner — Hester Peirce (R), Commissioner — Elad Roisman (R)
With the fifth Commissioner and last holdover from the Obama administration, Kara Stein, can’t serve past December. The majority in favor of cryptos and the Bitcoin ETF seems to be in favor of 3-1 with Chairman — Jay Clayton, Commissioner — Hester Peirce and Commissioner — Elad Roisman all favoring cryptocurrencies (based on their present and past statements). The only Commissioner — Robert Jackson, Jr. is the one who could probably vote against the Bitcoin ETF as in past as well he has shown little support for a Bitcoin ETF or cryptocurrency in general. He voted against approving Winklevoss in the SEC’s review and will likely oppose SolidX as well.
Coinbase could consider applying for Bitcoin ETF
With things slowly falling in place for a Bitcoin ETF, we could soon see Coinbase applying for a Bitcoin ETF. And it’s not all by itself. If reports are to be believed Coinbase has sought help from $6 trillion Wall Street giant BlackRock for its ETF application. As reported by Business Insider, Coinbase in recent weeks has held conversations with people from BlackRock’s blockchain working group to tap into the firm’s expertise at launching exchange-traded products. BlackRock, an early pioneer of the ETF market, is well known for its iShares division. It remains unclear whether the talks were a one-off or part of ongoing conversations between Coinbase and BlackRock. BlackRock representatives from the working group didn’t give any concrete recommendations to the crypto exchange operator.
While the development could be positive, one has to remember the independently BlackRock had confirmed it had no interest in being a crypto fund issuer. And its CEO, Larry Fink, has said the firm’s clients have expressed zero interest in the $300 billion markets for digital currencies, referring to bitcoin as an “index of money laundering”. With Coinbase being in play, Blackrocks job here could be just for structuring the ETF. We will have to wait and see what comes out of these meetings between Coinbase and Blackrock.
The news here this time around ETF is positive and somewhat confirms that we could see a Bitcoin ETF in Q1 2019 as many on the street believe.
Will the SEC this time clear the hurdle of a Bitcoin ETF? Do let us know your views on the same.
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Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Nilesh Maurya has been associated for past 8 years as an Investment Banker with Omega Capital, a bespoke Investment Banking outfit having offices in Mumbai, New York, Singapore, and Dubai. He has been a regular contributor to business publications such as Business India and Market Express and has been a mentor to many start-up companies. Follow him on Twitter at @KoinKing1 or connect with me on linkedin.