As was reported earlier today, after an extended deliberation, the Securities and Exchange Commission (SEC) has approved eleven Bitcoin ETFs. CI has received multiple comments on the approval which is a seminal event for the crypto industry.
Rajeev Bamra, SVP of Digital Finance at Moody’s Investors Service, said the approval of spot Bitcoin ETFS has the potential to simplify and secure Bitcoin investments for a broader investor base:
“[This] may reshape the dynamics of cryptocurrency investments. It could lead to substantial inflows from institutions interested in entering the cryptocurrency market as it may provide a reliable and transparent price discovery mechanism. This could result in a more stable and liquid crypto market, representing a positive development for the digital finance ecosystem. In 2023, Bitcoin and Ether have made cryptocurrencies the best performing asset class. Whether this trend will hold depends on the trajectory of global monetary policy-making as well as the availability of cryptocurrencies to institutional investors through products that meet regulatory standards, ensuring their safety and security.”
Also from Moody’s (Analytics) Senior Director Yiannis Giokas stated:
The SEC’s approval of Bitcoin Spot ETFs marks a significant step towards the institutionalization of cryptocurrency, expanding Bitcoin’s accessibility to a wider audience in a more regulated and simpler manner. Such an ETF could lead to increased demand for Bitcoin, and enhance both price discovery and market liquidity. However, this development also brings certain risks. The notorious price volatility of Bitcoin, as well as its fluctuating values against stablecoins and other cryptocurrencies, could expose mainstream investors to a less familiar spectrum of investment risks.”
OTC Markets Group shared their perspective on the Bitcoin ETFs. OTC Markets has long listed Grayscale’s Bitcoin Trust – along with other crypto vehicles. OTC Markets may now lose the listing of the Bitcoin Trust but they view this as a victory for the marketplace:
“OTC Markets Group applauds GBTC’s move to NYSE as a spot Bitcoin ETF, marking a pivotal moment for Grayscale and for regulatory support in the digital assets industry. Since 2015, our OTCQX Market has proudly supported GBTC and other digital asset securities, fostering capital growth and investor interest in a regulated environment. We are proud of our role as a growth catalyst in propelling these products toward a new phase as exchange-traded funds.
Over 300 companies have graduated from the OTC markets to major exchanges over the past five years, making the U.S. OTC markets the most successful venture market in the world. OTC Markets Group continues its mission in empowering companies to be public and offering a platform for companies to grow.”
Congressman Patrick McHenry, a longtime supporter of Fintech innovation and Chairman of the House Financial Services Committee, joined with Congressman French Hill in the following statement:
“Today’s spot Bitcoin ETF approvals mark a historic milestone for the future of the digital asset ecosystem in the United States,” said the lawmakers. “While legislation to provide clarity and certainty for digital assets remains necessary, the steps taken today are a significant improvement over the SEC’s track record of regulation by enforcement. We are pleased that investors and our markets will finally be afforded greater access to this generational technology. We remain committed to enhancing consumer protection in the digital asset markets through comprehensive market structure and payment stablecoin legislation.”
Ruslan Lienkha, Chief of Markets at YouHodler, said the approval will stimulate the growth of crypto:
“The SEC didn’t have strong arguments to reject these filings. This final decision will be accompanied by price volatility, and BTC might experience a correction due to the fact-selling effect after several months of dramatic growth. However, the overall dynamic will remain bullish, and the approvals will have long-term positive implications for this asset.”
CEO of the Crypto Council for Innovation, Sheila Warren, said the spot Bitcoin ETFs “will shift public perception” and “is a significant move towards integrating crypto into the mainstream.”
It was obvious to all that the SEC grudgingly approved the exchange-traded funds. Following the announcement, SEC Chair Gary Gensler issued a cautionary statement on the approval, highlighting the EFTs will be stringently regulated. Gensler stated:
“While we approved the listing and trading of certain spot bitcoin ETP [exchange traded products] shares today, we did not approve or endorse Bitcoin. Investors should remain cautious about the myriad risks associated with Bitcoin and products whose value is tied to crypto.”
The CEO of Tether and Bitfinex, Paolo Ardoino, welcomed the approval, calling the decision transformative. He added that Bitcoin has the potential to empower everyone, from emerging markets to institutional investors, in the crypto and blockchain space.
“This momentous event is anticipated to significantly broaden the accessibility and legitimacy of Bitcoin, potentially leading to a surge in investments and widespread adoption. Such increased interest and legitimacy are likely to spark a wave of innovation, attracting more talent and capital into the industry. At both our companies, we’re excited about this pivotal moment and what it means for access to Bitcoin and we are committed to collaborating with regulators to enhance industry transparency for all involved.”
Research by Security.org indicates that Bitcoin ETFs could lead 21 percent of non-owners to invest, or as many as 29 million Americans.