Bitcoin is the most popular cryptocurrency in the world, having served as a blueprint for all other digital currencies since its market launch in 2009. Over the years, it multiplied its value several times and became one of the most valuable asset classes in the world. Many see it as a reliable source of diversifying their portfolios and capital and can also provide a hedge against inflation. Yet, before beginning an endeavor, it’s essential to remember that several things can impact the BTC price point.
The best and safest way to buy Bitcoin is to use the service of specialized exchanges. Binance is one of them since it takes user security into account and can guarantee that your assets will be safe. World news and events are among the most widely-recognized category. Macroeconomics, inflationary events, and interest rate hikes all left dents into the marketplace, and this year’s difficult global political situation, with military conflict and considerable diplomatic conflicts, has also affected Bitcoin’s progress.
SEC ruling
The cryptocurrency community has long been struggling with talks of regulations within the ecosystem meant to protect users against massive price fluctuations, as well as coin and exchange collapses. The events of 2022, when many platforms actually caved in and fell completely, leading to major capital losses for investors, convinced lawmakers that it’s essential for the environment to receive specific customized laws.
Moreover, given the fact that digital finance is increasingly becoming mainstream, with more and more investors adding cyber coins and tokens to their list of holdings, there’s also the possibility that negative effects from the market would trickle down into the domain of the other asset classes, causing considerable financial losses. However, regulations have also caused controversy within the market. Many traders aren’t convinced that the rules are meant to help the marketplace but rather to act as a way to control the crypto environment.
The considerable uncertainty has also harmed the price point, causing values to stagnate over the summer. Investors were expecting a definitive ruling of whether or not the Securities and Exchange Commission will allow ETFs to be integrated into exchange-traded funds by August 13th. Since that was on a Sunday, some were optimistic enough to expect the decision on August 11th. However, some analysts took a more sobering view, saying that it’s more likely that the decision will be postponed until later.
Regulators declined to rule on the issues, and the next date when a decision is expected is September 1st. The SEC is likely to conclude then, but it’s not just the Bitwise Bitcoin ETP Trust that is expected to get a definitive answer. VanEck, WisdomTree, BlackRock and Invesco will get a ruling on September 2nd. Others are expected to follow over the next few days. That is, of course, if nothing changes until then, that could push the decision even further.
Investors VS Regulators
Expectations are high among investors, who have been watching the developments unfold with no small amount of apprehension. A successful outcome would mean that a fund that invests directly in BTC would be accepted by regulators and receive the green light to operate directly. It’s something that many in the community have been waiting for, as it would make investing far more accessible for investors. It would also be a crucial step towards moving Bitcoin closer to traditional markets and general public acceptance.
However, regulators themselves might be the biggest impediment to this plan having a successful outcome, since many still believe that digital money is fundamentally unreliable and potentially dangerous. Considering that prices have frequent fluctuations, and figures tend to shift quite a lot, lawmakers believe that the cyber tokens are simply too changeable ever to create a real profit and that there are many other asset classes that would perform better and yield similar, if not superior results. Many are also concerned about the possibility of manipulation and fraud within the environment, which can seriously affect the marketplace.
However, several corroborated factors might give ETFs a better chance of achieving their goal. Many companies have already submitted their paperwork for futures, including Ether-based as well as Bitcoin-and-Ether medley funds. While these futures are currently non-tradeable in the United States, being rejected by the SEC earlier this year, the situation might soon change. The launch of BITX, which aims to provide twice as much daily exposure for BTC futures and keep track of the price movements, might have also softened the SEC’s stance on the ETF issue. Since its introduction back in June, the fund has gathered over $20 million in assets.
Despite all these changes, many expected yet another delay in September, and some even believe that, even if the ETFs are officially approved, they’re unlikely to be approved during the first ruling, and it might still take a while until investors can start trading them.
Potential changes
However, after crypto ETFs are approved, they’re likely to usher in a revolution of Bitcoin and the entire crypto environment. ETFs are a large sector, with some investment companies managing approximately $3 trillion in assets, including various bonds, commodities and stocks. The acceptance into the digital finance environment wouldn’t just signal more extensive acceptance within the market but also the fact that Bitcoin is becoming more mature and stable, able to sustain a reasonable price while also improving innovation.
Critics within the community, however, have argued that the assets will be bad for the blockchain’s decentralized nature, as investors won’t be able to control their own funds without needing intermediaries. However, it’s essential to consider that if the SEC eventually approves the ruling, it wouldn’t be long until markets all over the world begin backing ETFs as well, such as in Canada and Hong Kong. It’s improbable that most Bitcoin users would risk getting left behind. As such, embracing the crypto revolution is far more likely.
The ETFs could pave the way for a better, more transparent and inclusive system that could be introduced into a system that creates the conditions for better access to traditional markets. And that’s a lot for the Bitcoin community to be excited about.
