Cboe urges U.S. regulators to move forward with bitcoin ETFs

[Goozzi]

NEW YORK (Reuters) - U.S. securities regulators should not stand in the way of exchange-traded funds that hold cryptocurrencies like bitcoin from coming to the market as they are essentially the same as other ETFs that hold commodities, said exchange operator Cboe Global Markets.

Source: https://www.reuters.com/article/us-cboe-etf-bitcoin/cboe-urges-u-s-regulators-to-move-forward-with-bitcoin-etfs-idUSKBN1H224L

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[warrior333]

I think no one is delaying the arrival of cryptocurrency. Now we see the collapse of bitcoin prices and it is not accidental. I think that the major players in the us stock market are now conducting an unprecedented transaction for buying bitcoins. Once they buy bitcoin in large volume they'll come out on the market. But I think it will not benefit the bitcoin community.

[jseverson]

I honestly believe it's just a matter of time until Bitcoin breaks into ETFs. It has already broken into futures trading, after all, which proves that the traditional financial sector has started to recognize its legitimacy. The SEC's argument against it also seems rather weak, too, so it's not like they have any massive concerns.

The question would be: what effect would this have on Bitcoin? People can't seem to agree if futures helped or not, so I imagine ETFs' effects wouldn't be black and white either.

[Sithara007]

I don't understand why the SEC guys are so hostile to Bitcoin ETFs. Both CME and CBOE are trading Bitcoin futures and everything seems to be going well on that front. Then what is the problem in approving the Bitcoin ETFs? IMO, ETFs can be less volatile when compared to the futures?

[squatter]

There's something very ironic about exchange-traded funds for assets that can literally be traded P2P. Futures markets make sense because large-scale businesses and miners can limit exposure to volatility risk by hedging with forwards. An ETF would really just be for speculation. It would mainly exist because of current regulatory uncertainty and counterparty risk around spot trading for institutional firms.

I don't understand why the SEC guys are so hostile to Bitcoin ETFs. Both CME and CBOE are trading Bitcoin futures and everything seems to be going well on that front. Then what is the problem in approving the Bitcoin ETFs? IMO, ETFs can be less volatile when compared to the futures?

I wouldn't say they're hostile. Bitcoin and cryptocurrencies are a brand new asset class. They haven't even existed for a decade yet. That alone suggests the SEC should take time to analyze market conditions. Liquid ETFs can mean significant Wall Street exposure, which can in turn have major effects on the US and even the global economy. If an ETF will be derived from the futures markets, the SEC would want to see very healthy and liquid futures markets. For now, volume is still quite low.

Consider that the first US-regulated copper ETF was just established a few years ago. It took over two years to get approval.

Now compare bitcoins to copper.