Chris Concannon, president and CEO of the Chicago Board Options Exchange (CBOE), explained that there are still obstacles that must be overcomed before the Securities and Exchange Commission (SEC) approves the first bitcoin-backed exchange traded fund (ETF).
“As we chip away at their issues to make them less concerned, at some point they’ll be comfortable with an ETF,” Concannon told Bloomberg.
Speaking about bitcoin futures, Concannon noted that trading in bitcoin futures is still low compared to mature assets such as gold or oil. Insufficient trading volume, in turn, makes the SEC hesitant to approve an ETF, although the introduction of an ETF backed by futures would significantly increase the trading volume in the underlying futures contracts. “It’s a chicken-and-egg problem,” he said.
Back in June, the CBOE filed a proposal for an ETF on behalf of financial firm VanEck. This is the only such ETF that aims to be fully backed by physical bitcoins rather than bitcoin futures contracts. Some experts claim that bitcoin custody is the crucial issue for bitcoin ETF. Meanwhile, nine other ETFs backed by bitcoin futures are also pending decisions by the SEC.
The fact that the ETF was filed through a veteran financial institution such as the CBOE, and that it will hold real bitcoins in its reserves, has made the entire cryptocurrency community particularly excited about the prospects of this particular ETF. CBOEs boss, however, offered his own perspective on the crypto market by saying:
“I’ve learned that there’s been more articles than volume. It’s a little bit shocking to me the attention this market gets versus its size. The entire crypto market is a fifth of Apple.”
Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!