The approval for bitcoin exchange-traded fund is taking time at Securities and Exchange Commission’s end. However, Dan Morehead, cryptocurrency hedge-fund manager is of the opinion that investors are overreacting to the news of a delay. He further added that ETF rejection is an ongoing story from the past five years. The SEC is very cautious when it comes to ETF.
Bitcoin has a volatile price feed
According to the CEO of the Pantera Capital,
“I still think it will be quite a long time until an ETF is approved. The last asset class to be approved for ETF certification was copper, and copper has been on earth for 10,000 years. The main thing to remember is that bitcoin is very early-stage venture, but has real-time price feed — and that’s a unique thing. People get excited about the price and overreact.”
SEC has also made several rejections to attempts made to trade bitcoin ETFs, citing concerns about fraud and manipulation of bitcoin. Recently in the last month, they rejected an attempt by Cameron and Tyler Winklevoss, founders of crypto exchange Gemini, to list shares of their own ETF. Talking about the rejections, Morehead said,
“The ETF rejection is the same story we’ve had for five years. The SEC has been very cautious with an ETF.”
Morehead: Do not panic
On Wednesday, Bitcoin witnessed a downfall post the delay by SEC on the decision for a proposed bitcoin ETF. Morehead remarked that investors should feel optimistic about Bakkt, the Intercontinental Exchange’s cryptocurrency project with partners Microsoft and Starbucks. The tie-up was announced in early August instead of panicking over ETF news. He also pointed out that the cryptocurrency is still up about 82 per cent year over year with regards to the tumbling price of bitcoin. Bitcoin was last down 6.3 per cent at $6,288.30. This still makes it about 82 per cent higher year on year.