American investors are desperately waiting for the first Bitcoin ETF to be approved, but the US Securities and Exchange Commission (SEC) has been ruthless in its decision making so far – declining all nine applications to date. This prompted a group of US lawmakers to sign a letter and send it to the SEC, demanding it changes its process or risk killing the American crypto industry. Just a week after this letter was delivered, the SEC has announced that it’s filing amendments to the BTC ETF application process. This now means that it could be possible for one of the nine declined ETF to get approved upon their next submission.
GraniteShares Fighting Back
In the new filing, GraniteShares has thrown traditional equity markets under the bus in a bid to prove that Bitcoin is in fact safe and not susceptible to market manipulation. GraniteShares is quoted as saying, “First, the Exchange believes that the policy concerns related to an underlying reference asset and its susceptibility to manipulation are mitigated as it relates to bitcoin because the very nature of the bitcoin ecosystem makes manipulation of bitcoin difficult. The geographically diverse and continuous nature of bitcoin trading makes it difficult and prohibitively costly to manipulate the price of bitcoin and, in many instances, that the bitcoin market is generally less susceptible to manipulation than the equity, fixed income, and commodity futures markets.”
The announcement went on to say “There are a number of reasons this is the case, including that there is not inside information about revenue, earnings, corporate activities, or sources of supply; it is generally not possible to disseminate false or misleading information about bitcoin in order to manipulate; manipulation of the price on any single venue would require manipulation of the global bitcoin price in order to be effective; a substantial over-the-counter market provides liquidity and shock-absorbing capacity; bitcoin’s 24/7/365 nature provides constant arbitrage opportunities across all trading venues; and it is unlikely that any one actor could obtain a dominant market share.”
This essentially means that due to the fact there is no reporting on company performance within the Bitcoin ecosystem, insider trading can be eliminated and its diverse range of investors means that it’s almost impossible for one person to actively change the value of the price of Bitcoin.
While GraniteShares isn’t wrong, it’s definitely sugarcoating some aspects of the Bitcoin trading world. There are large whales – people who own large sums of Bitcoin – that can trigger market movements. If one whale decides to sell their entire Bitcoin hodlings, it could cause a price fall, just the same as if a whale places a huge buy order – it would force the price higher. These facts all have to be taken into consideration.
SEC Considering VanEck and SolidX Application
The SEC is still considering the VanEck and SolidX BTC ETF application. In fact, it has called for more comments from industry experts and accredited investors, so that it can make the best decision possible. Whether this is due to pressure from the crypto community, or whether the SEC just likes this ETF application we will never know, but it’s still a positive sign. If the SEC approves this Bitcoin ETF, it will be a landmark decision and will change the face of the global crypto markets.
It appears as if the SEC is slowly coming around to approving a BTC ETF, and when it eventually does, crypto markets will go wild. The vast amounts of pent up institutional money will suddenly start pouring in, helping markets see a healthy green period – something hodlers will love to see after the recent massacre of prices.