Bitcoin prices tumbled last week after the Securities and Exchange Commission (SEC) delayed a decision on a bitcoin ETF filed by investment firm VanEck and blockchain technology company SolidX.
According to the SEC, “the Commission, pursuant to Section 19(b)(2) of the Act designates September 30, 2018, as the date by which the Commission shall either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change.”
Some market observers believe delays in getting a bitcoin ETF approved could drive weaker traders from the crypto market.
“Each consideration will be accompanied by positive news and reports, adding to a cryptocurrency price-hike. And every rejection will lead to negative analysis, which will also contribute to the slump. The sell-offs during the lows are going to lead to a bearish market as new money comes in to take Bitcoin off ‘weak hands,’” reports CoinCentral.com.
Bitcoin ETF Delays Galore
In June, ETF issuer VanEck and SolidX, a fintech company engaged in the bitcoin ecosystem, revealed plans for the VanEck SolidX Bitcoin Trust ETF (XBTC). That fund is targeted at institutional investors as it would debut with a share price of $200,000. That product would track an index linked to a group of bitcoin trading desks, possibly allaying some of the SEC’s prior concerns about funds linked to physical bitcoin.
Last month, the SEC rejected plans by Winklevoss Capital Management founders Cameron and Tyler Winklevoss to launch the Winklevoss Bitcoin Trust, but some market observers believe the regulator will eventually approve exchange traded funds linked to bitcoin.
Related: Why Marcus Lemonis Does Not Invest in Bitcoin
A recent letter from VanEck to the SEC addressed some issues, including the use of futures and market liquidity. Bitcoin futures debuted on the Chicago Board Options Exchange (CBOE) in December with CME Group following suit just a few days later.
“When the SEC approves the first Bitcoin ETF, the inevitable bull-run will follow and thereafter, huge price swings caused by the entry of ‘whales’ with hundreds of millions of dollars to invest. The volatility will happen naturally because of price manipulation. This could go on for years,” according to CoinCentral.
For more information on the cryptocurrency market, visit the Bitcoin category.