Bitcoin backers could have longer to attend for an exchange-traded fund instantly tied to the cryptocurrency or its futures contracts, CFRA Analysis’s Todd Rosenbluth informed CNBC’s “ETF Edge” on Monday.
The price of bitcoin has climbed 35% within the final two weeks as buyers grew optimistic concerning the Securities and Alternate Fee’s plans for the quite a few bitcoin ETF purposes at the moment underneath its assessment.
Greater than a dozen corporations are nonetheless ready to listen to whether or not their respective filings for bitcoin-based ETFs will progress to the general public markets. Others, together with VanEck, Invesco, Amplify ETFs and World X, have launched tangential merchandise targeted on blockchain infrastructure or the broader cryptocurrency economic system.
“We expect we’re extra more likely to see a bitcoin futures ETF first,” stated Rosenbluth, senior director of ETF and mutual fund analysis at CFRA.
VanEck, ProShares, Invesco, Valkyrie and Galaxy Digital have all filed for bitcoin futures ETFs. The primary 4 might be accredited, denied or have their selections delayed by mid- to late October; Galaxy Digital’s destiny will probably be revealed by Nov. 1.
“It is a timing situation,” Rosenbluth stated. “Does it occur in 2021 or does it transfer to 2022 so all of those merchandise that … might meet the targets really are accredited and may launch on the similar time as a substitute of getting a first-mover benefit?”
“It is potential — in actual fact, we expect it is seemingly — that we will see a delay of a bitcoin futures ETF till 2022, till the regulatory atmosphere is extra clear,” he stated.
The SEC is principally involved concerning the potential for discrepancies between bitcoin and futures costs, the potential for funds to get too giant and push the bounds on what number of contracts they’ll personal, and the danger of cross-border funding, Van Eck Associates CEO Jan van Eck stated in the identical interview.
“In bitcoin rallies, bitcoin futures methods can underperform by even as much as 20% a yr,” van Eck stated. “The SEC desires to have some visibility into the underlying bitcoin markets.”
As for regulatory management, the SEC already wields it in a number of methods in the case of cryptocurrency buying and selling, van Eck stated.
Robinhood, which affords crypto buying and selling, falls underneath the SEC’s jurisdiction as a result of it’s registered as a broker-dealer, van Eck stated. The SEC additionally could have achieved “de facto regulatory management” over Coinbase, which stopped providing a lending product a number of weeks in the past on the fee’s request, he stated.
That would assist the bitcoin futures ETF’s probabilities, but it surely’s unclear by how a lot, the CEO stated.
“They clearly have some management over gamers within the underlying bitcoin markets, so perhaps that will increase the possibilities from zero, however I do not know what they’re,” he stated.
Along with the mushy Oct. 25 approval deadline for VanEck’s bitcoin futures ETF submitting, the SEC has a tough Nov. 14 deadline to approve or deny VanEck’s proposal for an ETF based mostly on bodily bitcoin.
Disclosure: Invesco is the sponsor of CNBC’s “ETF Edge.”