eToro’s Mati Greenspan is Optimistic on VanEck’s Bitcoin EFT SEC Approval Potential
Mati Greenspan, eToro Senior Market Analyst, Explains Why the SEC will accept VanEck's Exchange Trade Fund
The SEC has been confronting the hard questions surrounding the subject of cryptocurrencies and how they can be worked into the world of investment. The answers to these questions may see the door opened for an exchange-traded fund for the likes of Bitcoin in the near future.
Two specific examples of this include the propositions by both the CBOE and the VanEck SolidX Bitcoin Trust for their potential ETFs. While the potential is there, proposals like that introduced recently by the Winklevoss twins were rejected, implying that the way is not as clear as we'd like to believe.
While the Winkelvoss's ETF failed to gain momentum due to its failure to convince the SEC that it would be stable in the face of potential price fluctuation. In contrast, VanEck's ETF offers a more robust system can withstand the SEC's scrutiny in contrast. According to Mati Greenspan, the Senior Market Analyst for eToro, this is what sets VanEck apart from other ETF's.
“The VanEck ETF is specifically designed to suit the needs of institutional investors. The contract size is set at 25 BTC, which is about $200,000 at today’s prices. So, [it’s] certainly not for your average Joe,” Greenspan argues.
“When a hedge fund investor who manages billions of dollars is considering to diversify their portfolio into Bitcoin, they don’t want to deal with things like private keys and cold storage. They also need the assurance of a trusted counterparty and a regulated exchange. Furthermore, VanEck’s BTC ETF will be fully insured, which is a very comforting thought when dealing with this type of capital.”
One of the strong points that VanEck has in comparison to the Winklevoss twins is that boasts a strong reputation in the world of Exchange Traded Funds. In the recent past, however, it has been involved in a partnership with SolidX, a blockchain startup but can also lend greater credibility to the proposal once submitted to the SEC.
But why did VanEck need to come forward with a partnership? Effectively, it was in order to sweeten the deal for the SEC in the wake of a number of previous rejections the proposed ETF faced at the hands of the regulatory body.
While both organizations are proving stubborn in their attempts to cobble together one of the first cryptocurrency-based ETFs, it remains to be seen whether the duo will be able to pass the SEC's acid test and confer their blessing upon the two.
Still, having an insured product with a fully managed solution that caters to hedge funds might just push things over the edge and satisfy the SEC. Although some legal experts think a bitcoin exchange traded fund approval might not come until February 21, 2019, many are optimistic about the upcoming August 10th and September 21st dates all cryptocurrency enthusiasts are eagerly awaiting.