Retail demand may force the SEC to approve a Bitcoin ETF. Is this a turning point?

Source: CointelegraphChina

Editor’s Note: The original title was “Retail demand may force the SEC to approve a Bitcoin ETF”

Several investment firm executives debated the possibility of the United States Securities and Exchange Commission (SEC) approving a United States Bitcoin (BTC) exchange-traded fund (ETF) during a CNBC broadcast on March 7.

Previously, the SEC had just rejected its last previously pending Bitcoin ETF application.

Wilshire Phoenix first filed an application with the SEC for the proposed “United States Bitcoin and Treasury Investment Trust” in January 2019.

Despite revising its application six times in 13 months, the SEC rejected Wilshire Phoenix's ETF application, citing concerns about the high potential for manipulation of the Bitcoin market and limited levels of investor protection.

Bitcoin ETF may be approved due to widespread demand

Chris Hempstead, head of ETF institutional business development at hedge fund provider IndexIQ, predicts that as retail demand for Bitcoin ETF products grows, a Bitcoin ETF will emerge.

“I highly doubt this will be the final straw,” Hempstead said. “I think everyone will continue to listen to the feedback and input from the SEC and what their comments are and they will continue to work through this.”

While Hempstead predicted the SEC would reconsider its position if faced with widespread demand in the coming years, he did not predict “any significant changes in the SEC’s decisions in the near future.”

“At some point, when market demand and investor demand push the pendulum to a certain area, they might take a second look or have a different consideration.”

Nick Colas, co-founder of investment analysis firm DataTrek Research, expressed doubts about whether the SEC would authorize a bitcoin ETF in the near future.

“You’ll see a central bank cryptocurrency before you see a bitcoin ETF,” he said.

Stablecoins meet consumer needs

When asked if stablecoins have “imminent relevance” to consumers, Hempstead responded: “I think you’re looking at something.”

Hempstead predicts that stablecoins and other cryptocurrency products will be regulated as the industry matures and the public gains a better understanding of the inner workings of distributed ledger technology (DLT).

“I think what they’re waiting for is probably more of a systemic macro understanding of the operational complexity of cryptocurrency trading […] I think as we start to see more diversification of risk and more understanding of how these different products, not just Bitcoin, work — I think that’s probably what’s needed at the committee level.”

Blockchain is “more important” than Bitcoin

Dan Wiener, chairman of Adviser Investments and senior editor of Vanguard Investors’ independent advisor, believes that corporate adoption of blockchain technology is “more important” than cryptocurrencies.

Wiener dismissed the need for Bitcoin, arguing that payment platforms like Venmo attract more users than cryptocurrencies.

“Do we really need Bitcoin? I’m not a bad guy. I don’t need to worry about moving money […] We have many, many ways to move money, and I don’t know if we need to hide ourselves, or our identities.”

Original link: https://cointelegraph.cn.com/news/retail-demand-may-force-the-sec-to-approve-a-bitcoin-etf