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Coinbase Explores Bitcoin-Backed ETF With Wall Street Giant

Coinbase Hints At Plans For ETF 

Bitcoin-backed ETFs have been the topic of discussion throughout the cryptosphere over the past few months, as investors and traders claimed that a single publicly-traded ETF would revive the otherwise slumping market. And it seems that this discussion may continue, with those familiar with the matter recently revealing that Coinbase has its eyes on establishing a crypto-focused exchange-traded fund (ETF) in a bid to attract retail investors.

It is important to note that the planned ETF will likely track a variety of cryptocurrencies, not just Bitcoin, possibly indicating that the firm is continuing to look at more crypto assets to add to its already expansive ecosystem.

Although this news was somewhat to be expected, as Coinbase has become well-known for being the primary home of innovation in the cryptosphere, insiders revealed that the firm has sought help from Wall Street giant BlackRock to aid in the establishment of this vehicle, reports Business Insider.

For those who are unaware, BlackRock is a New York-based, yet multinational investment management corporation with over $6.3 trillion worth of assets under management. As reported by Ethereum World News previously, BlackRock has hinted at making a meaningful foray into the cryptocurrency & blockchain industry, so it would make sense for Coinbase to team up with such a firm.

Those familiar with the cryptocurrency company went on state that in recent weeks, Coinbase has been incoinbase adds 100k users contact with individuals from BlackRock’s blockchain-focused division to “tap into the firm’s expertise” of launching exchange-traded investment products. According to the aforementioned insiders, representatives from the Wall Street firm’s blockchain branch were unable (or did not want to) give any direct advice to the San Francisco-based crypto startup at this time.

As Business Insider went on to report, it remains to be seen whether Coinbase’s involvement and discussion with BlackRock are ongoing or just a one-off event, but many optimists hope that it is the former, as a long-term relationship between the two may lead to interesting crypto-focused products, services, and investment opportunities.

The current climate around Bitcoin ETFs is rather contested, with the SEC recently making a series of moves to deny and delay a multitude of ETF proposals from an array of firms, whether said firms hail from crypto-focused or legacy market-centric backgrounds.

But as covered by Ethereum World News, the CEO of crypto startup Abra recently stated that the SEC’s denial verdict is somewhat valid, as the firms backing the ETF applications don’t “feel, smell or look” the part of a traditional financial institution. So the fact that Coinbase could be potentially working with BlackRock, an evidently well-established financial institution, may signal that an ETF application spawned from a collaborative effort between the two firms could see regulatory approval in the near future.

Photo by Luca Bravo on Unsplash

The post Coinbase Explores Bitcoin-Backed ETF With Wall Street Giant appeared first on Ethereum World News.

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Breaking: SEC Is Reviewing The Nine Bitcoin-Backed ETF Denials

The Bitcoin and crypto-backed ETF saga has continued, with the SEC recently revealing that it would be reconsidering nine proposals that were denied on August 23rd. As reported by Ethereum World News, nine ETF applications from ProShares, Direxion, and GraniteShares were rejected yesterday in a triple-blow to the stomachs of crypto investors, with the SEC citing concerns of manipulation and a lack of “significant size” markets to back up BTC’s spot price.

However, with a recent development pointed out by CoinDesk, the U.S. Securities and Exchange Commission will be “reviewing” the disapproval orders, in a so-called “staying” process.

SEC Commissioner Hester Peirce, crypto’s ‘inside woman’ in legacy systems, announced that yesterday’s orders would be reviewed in accordance with Rule 431 of the Commission’s Rules of Practice.

Simplifying the explanation of the rule, Pierce, who has been dubbed ‘CryptoMom’ by the community, noted that the Commision may often review actions taken by its staff. Elaborating, the SEC Commissioner wrote:

In English: the Commission (Chairman and Commissioners) delegates some tasks to its staff. When the staff acts in such cases, it acts on behalf of the Commission. The Commission may review the staff’s action, as will now happen here.

With this move, Hester Peirce has cemented herself as somewhat of a crypto proponent, as she vehemently spoke out against the SEC’s recent decision to disapprove the Winklevoss Twins-backed ETF for the second time.

Crypto Market Surges On SEC Update

As a result of this new development, the crypto market saw a quick surge to the upside, with Bitcoin quickly seeing a $150 gain, from $6,400 to $6,500 within a matter of minutes.

Altcoins followed Bitcoin, and are currently gains that are near-identical to the market leader. As it stands, Bitcoin has found a place to stand at $6,510 and is up by approximately 3% in the past 24 hours. While this bout of positive price action is welcome, some fear that this will not be enough of a move to bring the crypto market back into a state of “FOMO.”

This is a developing story, so Ethereum World News will be sure to keep you updated.

Photo by Joakim Honkasalo on Unsplash

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Poll: Cryptocurrency Will Make Up 5% of U.S. Investing in 2019

Cryptocurrency–A new survey conducted by The Harris Poll has found that cryptocurrency represents a decent portion of the expected investment by Americans for 2019. Despite the continued decline in Bitcoin price and overall valuation for the crypto markets, outlook for future investment still remains strong as more Americans are planning to get involved in the coming year.

Traditional stocks, bonds and real estate still hold the lion’s share of market interest, but perception is growing among U.S. investors that cryptocurrency might be the next big asset class to take part in, particularly to a degree that mitigates overall portfolio risk while still gaining exposure to the upside. Commissioned on behalf of the American Institute of CPAs (AICPA), The Harris Poll survey found that among the 35 percent of Americans who classify themselves as current investors or plan to invest in 2019, cryptocurrency will make up 5 percent of their overall investment. To put that number into perspective Exchange Traded-Funds (ETFs), which have dominated cryptocurrency headlines following the back and forth process through the U.S. Securities & Exchange Commission, constitute 8 percent of projected investment funds. With the SEC delaying decision on VanEck’s bid to form a Bitcoin ETF to the end of September, it’s possible there will be a crossover of the two investment classes by the time 2019 rolls around.

In addition to judging investment interest into cryptocurrency, the survey sought to gauge education and understanding of the industry within America’s active investors. While the numbers were in line with other reports of lower-than-desired education levels, the poll reports just under 50 percent of respondents had little to no understanding of cryptocurrency–a sign of the times that the industry still has a long way to go before reaching market saturation and greater adoption. In a statement addressing The Harris Poll findings, the AICPA remarked upon the level of familiarity exhibited by American adults towards cryptocurrency, despite the promising numbers for future investment,

“Cryptocurrency appears to be foreign to many investors. The survey found that nearly half of U.S. adults (48 percent) are not familiar with Bitcoin, Ethereum, or Litecoin.”

The poll also found that current investors into cryptocurrency and those who were familiar with the industry held disagreeing opinions over the future of the market, an understandable sentiment given the volatility experienced throughout 2018. Among respondents who fit this criteria, 24 percent expected cryptocurrency to continue to appreciate in price, despite the current bear trend, while 29 percent reported that the market was in for further decline. Respondents also identified market volatility, with 35 percent believing that the price would continue to fluctuate wildly, and only 12 percent reporting that prices would stay the same.

Reflecting the balanced portfolio approach of polled investors, which weighed cryptocurrency as only a small, but risky portion of their overall investment, the AICPA report cautioned over the risks associated with crypto while taking a long-term approach on the market,

“Before Americans invest their hard-earned money, it is important they take control of their financial future and do some research … A well-researched and properly diversified portfolio that matches an investors risk tolerance will give confidence to stay focused on long-term strategy and protect from the temptation to sell during short-term price swings.”

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BitMEX CEO: A Bitcoin ETF is Great For Adoption, Triples-Down On $50k Prediction

Despite the SEC declining the Winklevoss Twins’ ETF proposal, the discussion of such a fund is still a hot topic within the cryptocurrency community. CNBC Africa’s “Crypto Trader” show, hosted by Ran NeuNer of OnChain Capital, recently spoke with BitMEX’s CEO regarding what an ETF means for this nascent industry.

Taking into account Bitcoin’s current price action, Ran opened up the interview by asking Arthur Hayes how BitMEX has been performing. For those who are unaware, BitMEX is one of the highest volume cryptocurrency mercantile exchanges in the world, offering up to 100x leverage for traders of the XBT (BTC) contract.

The CEO of BitMEX noted that the exchange has been doing well, as a direct result of the volatility seen in the cryptocurrency markets.

Hayes also added that the exchange had done “four to five times” the amount of volume it had facilitated in the entirety of 2017. This figure took many by surprise, as a majority of other exchanges have been seeing declining volumes. However, taking into account that BitMEX supports leverage trading, it makes sense why this may be the case.

Arthur Hayes Speaks On Crypto-Based ETFs 

The Crypto Trader host went on to question Hayes about his outlook on Crypto-backed ETFs. The exchange executive first noted that there are two proposals that have verdict dates set for September, and another two in February 2019. Extrapolating what this information means, Hayes stated that he sees a “50/50 chance that we see some decision in Q3, and again we have another two ETFs looking for approval in February of next year.”

Speaking more on the highly-anticipated VanEck and SolidX’s ETF proposition, the executive said that “I don’t know.” Although those three words may be vague, he later elaborated on this specific proposal. Hayes stated:

“I think at the end of the day that the SEC wants to keep people interested in the financial markets and if retail continues to ask for these particular products (ETFs), at some point they are going to have to approve one of them.”

The CEO went on to call out the gold ETFs, pointing out the industry surrounding one of the most valuable metals in the world is unregulated, so “how could regulators not allow a Bitcoin ETF?”

Later speaking more on the most recent ruling on the Winklevoss ETF, Hayes commended the brothers for laying the groundwork for this aspect of the crypto industry, adding that other issuers will benefit from the work completed by their unsuccessful predecessors.

Ran, seemingly not fully satisfied with that answer, went on to query the industry leader on the SEC’s fears of the “underlying” Bitcoin price manipulation. Hayes brought attention to the fact that the SEC has not shown “empirical evidence” of what the regulatory body sees as manipulation, justifying that this reasoning is just an “excuse.”

What Does An ETF Mean For The Cryptosphere?

BitMEX’s CEO sees that acceptance of such a fund will produce a capital influx from retail investors, as an ETF streamlines the process of onboarding fiat into this industry, stating:

“Retail traders do not want to have to worry about securing a Bitcoin wallet, where do they buy it from, using the different exchanges. So if all they have to do is to click on their E*Trade, Scottrade, Interactive Brokers, 401k (etc.), to buy an ETF that gives them exposure to Bitcoin, but not allow them to experience the risks of holding it, that is a very powerful way for them (retail investors) to get involved”

Closing off his time on the show, Hayes tripled-down on his $50,000 price prediction, expecting that a positive ETF verdict will push the price of Bitcoin to the stratosphere.

While some may be skeptical of his analysis and speculation, Hayes perpetually keeps his ear to the ground of this industry, so it is likely that his statements hold some credence.

Title Image Courtesy of MaxPixel

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