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Real Reason Why the SEC Rejects Bitcoin ETF

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Only two days ago, August 23, the US SEC once again rejected all Bitcoin ETF requests, this time filed by Direxion and ProShares. Experts claim that the reason behind the rejection is fear of ETFs leading to fraud and market manipulation.

Winklevoss twins Bitcoin ETF proposal

About a month ago, the SEC stated that market manipulation is a real concern, which is why they rejected the Bitcoin ETF request filed by the Winklevoss twins. The twins managed to establish Bitcoin’s values through the use of their crypto exchange, Gemini, which is said to be strictly regulated.

However, this was not enough for the SEC, and the Commission stated that the markets can be relatively easy to manipulate, given the opportunity. Relying on one single exchange to dictate Bitcoin ETFs’ value would be exactly one such opportunity. Bitcoin ETF can potentially lead billions in new capital to the market, and this is too serious an amount, and represents a high risk to the economy, in general.

Prior to the refusal, the twins were convinced that their proposal actually had a good chance to be approved. This was additionally supported by Nasdaq’s involvement, which is the second-biggest stock market in the world. Nasdaq is involved in Gemini’s operations so that all tradings and the market itself would always remain authentic and completely transparent.

Direxion and ProShares made their own attempt

After the SEC rejected the request of the Winklevoss brothers, it received new proposals filed by Direxion and ProShares. Their proposals used CME and Cboe futures markets, which are also very strictly regulated, to try and establish their ETF’s value. However, the SEC found a flaw to this proposal as well and stated that, while CME and Cboe are, in fact, regulated markets, the BTC futures markets are not large enough to be used for establishing the value of ETFs.

According to the government enforcement defense and securities litigation attorney, Jake Chervinsky, the real reason for the SEC rejecting all of these ETFs is the risk of fraud and market manipulation. If the ETF’s design significantly lowers or even prevents these risks, then the SEC would approve it. Unfortunately, these ETFs are not designed in such a way.

He also said that the SEC was not satisfied with the two institutions’ efforts to only rely on the futures markets. This is due to the fact that the majority of BTC trading still goes down in unregulated exchanges and markets. This makes the BTC futures markets too small, as well as unable to provide enough information regarding the market participants’ identities.

In time, when the BTC futures market grows, and regulated financial institutions expand enough to create bigger futures markets, the SEC might change its mind regarding the ETFs backed by derivatives. However, for now, the SEC has no intention to approve marked-backed futures in the US. Even so, many believe that the ETFs filed by Cboe and VanEck have the highest chance to actually be approved in a relatively short period, which remains to be seen.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

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Bitcoin

4 Reasons Why the New Bitcoin Rally Is Unlikely to Stop Now

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After more than a year of declining prices, the crypto market is finally seeing a period of serious recovery — one that has already brought digital currencies to heights not seen in over half a year now.

Only days ago, Bitcoin surged past several major resistance levels and managed to exceed its yearly high of over $8,000. Already, many skeptics are predicting the soon end of the bull run, and the possibility of yet another sharp decline. However, there are signs that suggest otherwise — that this bull run is only getting started, and that it will not end anytime soon.

There are four reasons why this is the case, and they are as follows:

1) Bakkt

There is the long-awaited Bitcoin futures exchange, Bakkt, which recently announced that the July test date for Bitcoin futures is soon to be set. Bakkt’s launch was delayed multiple times already, so the announcement came as quite a surprise. However, it appears that it will happen quite soon, after all.

As soon as its arrival becomes a certainty, Bitcoin will likely skyrocket even further, just like gold did when gold ETF appeared in 2013.

2) Bitcoin completely ignored the hacking of Binance

Binance has been the largest crypto exchange by trading volume for a while now, and as such, many expected that, if anything were to happen to it, Bitcoin…

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Bitcoin

The New Rally Has Arrived: Crypto Market Cap Goes up by $24 Billion Within a Day

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The crypto market’s recovery progresses further, and at a rapid pace, at that. Bitcoin has just surpassed the $8,000 mark, which is the first time its price has been that high since July of last year. In addition, the entire crypto market is making billions within hours.

Bitcoin (BTC) sees another serious surge

In the past 24 hours, the total crypto market cap has gone up by around $24 billion. Meanwhile, BTC price has grown by $1,000 within the same period, as the largest coin traded barely above $7,000 on early Monday. At the time of writing, the coin’s price sits at $8.014.31, with a 14% growth in the last 24 hours. Meanwhile, the BTC market cap has gone up to $141.85 billion, and even the coin’s trading volume surged to over $31 billion.

While many are wondering whether this is a return to the massive heights seen back in 2017 or only a temporary surge which will soon see a correction — no signs of an upcoming decline have been noticed as of yet. In fact, new heights were made and then exceeded multiple times in the past week, with a massive 33% gain during that time. And, with Bitcoin’s dominance at 60%, many are expecting that massive altcoin surges are to be expected as well.

The growth of altcoins can already be seen, as Bitcoin

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The Crypto Market Reaction to Bitcoin (BTC) Recent Surge

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Bitcoin (BTC) is finally back on track, with the world’s largest cryptocurrency recently reaching heights that were not seen in over half a year. The coin’s last big milestone was $7,100, and while it has gone beyond it, at the time of writing, a slight correction has started taking place.

However, while all of the attention is on BTC, it is also interesting to see how the altcoins are reacting to the new development. The market, as a whole, is looking a lot better these days, and it continues to improve constantly.

Bitcoin dominates the market

Bitcoin is currently once again dominating the market, with the belief that it needs to reach 60% in order to bleed out the overvalued altcoin markets. These days, its dominance is between 58% and 62%, depending on where you get your data from. This provides excellent conditions to try and predict what might happen to the rest of the market, as a similar situation already took place in the past.

Back before the new surges of 2019, and even before the bear market of 2018, and even further back, before  BTC reached its peak — Bitcoin saw similar levels of dominance on December 4th, 2017. Back then, the list of the top 10 largest cryptos by market cap had barely any similarities with the list as it is these days.

However,…

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