SEC Might Reject Proshares Bitcoin ETF, But Crypto Investors Should Hodl


Bitcoin May Crash When the SEC Rejects the ProShares ETF Within the Next 2 Days, But Investors Should Continue Hodling

The United States Securities and Exchange Commission (SEC) needs to make a decision on the ProShares Short Bitcoin ETF by August 23. It seems likely that the SEC will not approve the ETF, which could lead to another crash in crypto prices – but investors should continue hodling despite the bad news.

“Buckle up, bitcoin getting ready to crash,” extols one headline at CoinGape.com.

We saw bitcoin crash earlier this summer when the bitcoin ETF proposed by the Winklevoss twins got rejected for the second time. Then, bitcoin plummeted once again when the SEC delayed the decision on the VanEck SolidX bitcoin ETF.

The SEC needs to make a decision on the ProShares Short Bitcoin ETF by August 23. With the previous ETF denials and delays, the SEC has not waited until the very last day to make a decision; instead, they’ve typically made a decision 1 to 2 days before – which is why the ETF denial or delay could happen anytime.

The last time an ETF was denied or delayed, the price of bitcoin sank all the way to $5,980, near its low price on the year.

Over the next two months, 9 bitcoin ETFs have deadlines. That means the markets could face nine more ETF rejections. The ProShares Short Bitcoin ETF is the most pressing ETF.

The VanEck and SolidX bitcoin ETF has been making plenty of headlines over the last few months. However, the ProShares Short Bitcoin ETF may have a better chance of approval. Submitted last December, the ProShares ETF is backed by bitcoin futures. Unlike the VanEck SolidX bitcoin ETF, which holds physical bitcoin, the ProShares ETF holds bitcoin futures contracts. The value of the ETF comes from tracking futures contracts traded on CFTC-regulated marketplaces like CME or Cboe.

Bitcoin May Not Need ETFs: In Fact, a Bitcoin ETF Could Be “A Terrible Idea”

“Bitcoin ETF” has been the biggest buzzword in the crypto community of the past few months. We could just be hours away from approval of the world’s first bitcoin ETF. It seems more likely, however, that the SEC will continue rejecting bitcoin ETFs for the near future.

This brings up the question: do we really need a bitcoin ETF? Does the future of cryptocurrency depend on a bitcoin ETF?

Bitcoin expert Andreas M. Antonopoulos recently shared his views on the bitcoin ETF topic, saying:

“The idea here is to take a reserve of bitcoins and then make them tradable instruments that can be traded on traditional markets like stocks. This is a custodial reserve system, where the custodian holds the actual bitcoin and what you’re getting is a share in their fund — not bitcoin.”

Antonopoulos then added that he believes a bitcoin ETF is a terrible idea:

“I know a lot of people really want to see an ETF happen because “to the moon and lambos!” But I think it is a terrible idea. I still think it is going to happen, I just think it is a terrible idea. I’m actually against ETFs.I think a Bitcoin ETF is going to be damaging to the ecosystem.”

The reason, according to Antonopoulos, is that a bitcoin ETF will complicate every decision made by the community. These funds would balloon in value and instantly become some of the largest hodlers in the bitcoin community. The funds would have enormous sway over every decision made by bitcoin’s developers and miners:

“It’s not going to be the end of Bitcoin, it’s just going to cause manipulation of the prices. It is going to cause manipulation of the debates about scaling decisions, and if there are forks it is going to give these parties a very large determining voice in forks. Eventually, you’re going to see them split off and form their own corporate version of Bitcoin.”

In other words, bitcoin doesn’t need an ETF. It would certainly make it easier to buy bitcoin, and the price of bitcoin would likely rise in the short-term, but it could also cause long-term damage to the decentralized bitcoin ecosystem.

We could be in for a rocky few days. You may want to continue hodling. Many cryptocurrency enthusiasts have taken to twitter to share their thoughts, knowledge and worries about the impending decision. Here are a few of the best:

https://twitter.com/noahsarkcrypto/status/1031907218600419329

A few great threaded tweets: Click to open up the full thread

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