Traders bet on ETF approval, causes Bitcoin to surge above $60,000, could fall without approval

 

Bitcoin and crypto currencies always evoke mixed reactions depending on whom you ask as well as the country you belong to. The U.S. has fierce advocates including Mark Cuban, Jack Dorsey and Elon Musk as well as a few detractors. The Bank of England’s deputy director considers it to be unstable and said that it could cause a global financial crisis. Beijing had banned all kinds of crypto activities including trading and mining.

Some traders in the U.S. are betting on approval for the Bitcoin. This led to a surge in value and the Bitcoin crossed $60,000. The last time the digital token had reached this value or more was in April.

A person familiar with the matter said that the Securities and Exchange Commission (SEC) could allow the first U.S. bitcoin futures exchange-traded fund to begin its operations next week. The source asked not to be named as the discussion were ongoing and private.

The source said that the SEC will not block the ETFs that have been proposed by ProShares and Invesco. These are based on future contracts. The ETFs had been filed under mutual fund guidelines. Gary Gensler, SEC chair thinks that mutual funds give sufficient protection to investors.

If Wall Street’s top regulator the SEC allows trade, this would be a significant victory as crypto traders have long sought this approval. On Tuesday, the ProShares Bitcoin Strategy is expected to be launched at the New York Stock Exchange. Experts believe that the SEC will not object to this product.

Vijay Ayyar, head of Asia Pacific at cryptocurrency exchange Luno told CNBC that the ETF was being “priced in with the market expecting approval on Monday.” However, Ayyar also warned that a rejection of the ETF by Pro Shares could cause the coin to fall steeply.

Mikkel Morch, executive director of ARK36, a digital asset hedge fund expressed similar sentiments to CNBC and succinctly described the future ETF and Bitcoin as “buy the rumor, sell the news scenario.”
 


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