In 2019, we once again witnessed the crazy market of Bitcoin. On January 1 this year, the starting price of Bitcoin was 3,746 US dollars. At the end of June this year, the price of Bitcoin hit 14,000 US dollars. Up to now, Bitcoin has offered $8,166. Although it has experienced a September 25 plunge, the yield is still over 100%. There is no doubt that Bitcoin is still the best performing asset representative this year.
In 19 years, many favorable expectations have created a miracle of Bitcoin's gains. Libra and Bakkt went to the Chinese central bank's digital currency. Bitcoin, which once had a hard time, has gradually become the subject of heated discussion among people from all walks of life. It also reached a new height, but with the many favorable expectations, the bubble of this bitcoin broke again. Since September 25, it has repeatedly fluctuated within the range of $7,600 to $8,500. The market needs a signal to break this. In this case, the successful passage of the Bitcoin ETF seems to be the last expectation of investors in 19 years.
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As early as 2013, the concept of the Bitcoin ETF has been proposed. In 2016, the brothers of the Gemmi exchange founder Winklevoss first applied for the issuance of the Bitcoin ETF to the US SEC. Since then, there have been more than a dozen applications, but most of these applications have been Rejected or revoked. October 13 (Beijing time is 14th) is the deadline for the US Securities and Exchange Commission (SEC) to approve the Bitwise Investments Bitcoin ETF, and the SEC's attitude basically determines whether the Bitcoin ETF can appear in 2019. .
The Wall Street Journal published on Monday that the answer sheet issued by Bakkt, the bitcoin futures platform of ICE, was disappointing two weeks after its launch, as will the Bitcoin ETF.
The industry also generally believes that the poor performance of Bakkt on the line has made the expected expectations burst, which has become the direct trigger for the collapse of the encryption market.
Matt Hougan, head of research at Bitwise Asset Management, said it is unrealistic to think that Bakkt will lead to a large influx of buyers. He said, "Things don't happen suddenly. They take days, weeks, months, and sometimes even years of brewing. Even if the SEC approves these bitcoin ETFs, it will be as slow as Bakkt at the start.
Then, can the Bitcoin ETF pass smoothly, and if it passes, will it immediately bring positive signals to the market?
Generally speaking, the probability of aging is difficult to escape and the fate is rejected.
US Securities and Exchange Commission (SEC) Chairman Jay Clayton said in an interview with CNBC in September that we are closer to the Bitcoin ETF, but there is still a lot of work to be done. Hosting is the main question, how can the SEC really know that investors hold digital assets. In this respect, it is clearly different from tangible assets such as gold or coffee. Clayton also said how we can determine that prices are not being manipulated as cryptocurrencies are traded on unregulated exchanges overseas. Clayton concluded that although progress has been made, it is impossible to move forward until people are satisfied and satisfied with these issues.
Compound General Counsel Jake Chervinsky commented on this: "To understand the language of Washington, DC, you have to understand from the lines. The message Clayton conveys here is that the Bitcoin ETF will one day be approved, but not today."
Previously, VanEck and SolidX withdrew their Bitcoin ETF proposal, and US government law enforcement defense and securities litigation lawyer Jake Chervinsky also said that the reason may be that the US Securities and Exchange Commission will reject it next month, and he also predicts that there will be no 2019 Bitcoin ETF.
In addition, Circle CEO Jeremy Allaire, founder of CBX Research Institute Gu Yanxi, securities law expert, and General Counsel of Compound Jake Chervinsky are not optimistic about the recent application of Bitcoin ETF.
The SEC has stated in previous Bitcoin ETF rulings that most of the proposals failed to prove its 'prevention of fraud and manipulation” and “protecting investors and the public interest.” The overall structure of the bitcoin market is increasingly criticized. I have cited academic research findings that it is easy to manipulate market behavior when there is a minority share of an asset that reaches the dominant market. Recently, Token Analyst data shows that the current eight major exchanges hold There are 7% of Bitcoin (nearly 1.2 million bitcoins, worth about $10 billion), which is the total supply of Bitcoin. The most common bitcoin in the coin wallet, followed by the currency and Bitmex.
At this point, the cryptocurrency market coincided with the plunge on September 25, which is more likely to aggravate the SEC's concerns about manipulation, and the possibility of adoption is greatly reduced.
Even if it passes, it may not be able to stir up waves.
The reasons why the Bitcoin ETF is highly anticipated are mostly due to the following points.
1. Attracting institutional investors to enter. According to statistics, the ETF, a regulated financial market, had a capital flow of $300 billion last year, so the Bitcoin ETF is expected to attract investors and bring huge capital flows.
2. Reduce the various risks of reality. Due to its particularity, Bitcoin needs to bear many risks such as storage risk and exchange risk. The Bitcoin ETF solves these potential risks for investors, and the security is greatly guaranteed.
3. Help to improve the public recognition of Bitcoin. If the SEC passes the Bitcoin ETF, the official regulatory attitude will certainly be eased, which will make more people accept Bitcoin, which is crucial for the long-term development of Bitcoin.
Whether it is Bakkt's online or Bitcoin ETF application, the biggest purpose is to use the characteristics of compliance and transparency to attract institutional investors, but it should be noted that institutional investors are not retail investors, and the standard of risk control is not The simple pursuit of convenience and capital security is more about controlling market risk, but at present, the difficulty is still too great.
Moreover, the market for Bitcoin institutions is still too small. According to the Wall Street Journal, CME's Bitcoin futures contract was launched in December 2017, which set a record volume this summer, in line with the rise in bitcoin prices. But it is still a small market. Last Friday, the volume of CME Bitcoin contracts was about 2,000 contracts, but it was still negligible compared to mainstream futures trading products.
Bitcoin core developer Jimmy Song recently commented on the topic of the Bitcoin ETF in an interview with BLOCKTV: "The Bitcoin ETF may be a good thing, but it will not be a 'game changer' as some people have said. Bit The currency ETF is more convenient. But if someone really wants to own BTC, he can do it without going through the ETF."
So it’s too early to bet on Bitcoin on Wall Street. Probably, as Matt Hougan, head of research at Bitwise Asset Management, puts it, "The Bitcoin ETF is not a starting gun that lets everyone rush out of the starting line."
It’s the current state of the organization that is ready to go.