Members of VanEck, SolidX and the Cboe BZX Exchange met with U.S. Securities and Exchange Commission staff earlier this week to present a new argument on why the bitcoin market is ready for an exchange-traded fund.
In the latest push to convince the regulator to approve a rule change which would open the door for the country's first bitcoin ETF, the three firms met with the SEC's Division of Corporation Finance, Division of Trading and Markets, Division of Economic and Risk Analysis and Office of General Counsel.
Instead, the proponents' argument centered around the idea that the bitcoin market is mature enough to support an ETF, and at present looks similar to markets for other assets which already have such products.
The presentation specifically tied the idea of futures markets with spot markets, noting that for money substitutes such as gold and silver, this connection between the two can be proven with empirical evidence.
The firms went on to explain that "Similar to commodity futures, the spot and futures prices [of bitcoin] are tightly linked," again providing "Evidence of a well-functioning capital market."
On another note, they argued that the bitcoin ecosystem is "Less susceptible to manipulation" than other commodities which already support exchange-traded products.
"The linkage between the bitcoin markets and the presence of arbitrageurs in those markets means that the manipulation of the price of bitcoin on any single venue would require manipulation of the global bitcoin price in order to be effective Bitcoin therefore is no more susceptible to manipulation than other commodities, especially as compared to other approved ETP reference assets."
Any attempt to manipulate bitcoin's price "Would require overcoming the liquidity supply of such arbitrageurs who are effectively eliminating any cross-market pricing differences," especially as these arbitrageurs are likely to have their funds stored on different exchanges to take advantage of price differences.
The applicants' pitch came a day before SEC chairman Jay Clayton said concerns about market manipulation are one of the barriers preventing an ETF approval.
Outside the market itself, the ETF's proponents highlighted Cboe's matching engine and VanEck's MVIS Bitcoin OTC Index as further benefits on Monday.
Bitcoin ETF Seekers Met With SEC Monday In Latest Pitch for Approval
Publicado en Nov 30, 2018
by Coindesk | Publicado en Coinage
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