Bitcoin’s next future move could come as early as Friday as SEC to decide on fate of ETF
Bitcoin has gone through a great deal of volatility over the past three months, including its reaching a new all-time high and surpassing the price of gold in dollar terms earlier this month. Â And while Bitcoin’s extremes in price movement have been primarily due to third party conduits such as through Bitcoin exchanges and regulatory restrictions imposed upon the crypto-currency by sovereign governments, the next big stage for the future of the digital currency could be taking place as early as Friday when the SEC is to decide on the financialization of Bitcoin.
Among the big drivers behind the recent move higher in the price of bitcoin – in addition to the traditional “capital outflow” demand out of China – has been widespread hope that the SEC will approve the first bitcoin ETF. And contrary to our report from January that such a decision, and ETF, will be delayed substantially, today Coindesk writes that according to its sources, the ETF decision is expected, either affirming or denying, is expected by Friday.
The SEC has a March 11th internal deadline, Coindesk reported, to decide on the proposed rule change that would clear the way for the ETF, which would be the first of its kind. However, as the 11th falls on a Saturday, that decision will come before that date, “potentially before Friday“, the source said. The decision would cap a more than three-year period since investors Cameron and Tyler Winklevoss first filed with the SEC in mid-2013. – Zerohedge
For Bitcoin purists, the creation of a Wall Street based ETF is an antithesis of what the founders of the crypto-currency intended when they sought to create a completely de-centralized form of money that was outside the purview of banks and sovereign regulation. Â And in today’s era of cheap dollars and overvalued paper assets, placing Bitcoin’s future into an ETF where investors would buy paper promises to ownership of the currency rather than actually owning the currency itself, could very well lead to manipulated price determinations and a form of centralization where the crypto-currency ends up under the control of the very banks the creators sought to bypass.
There are a growing number of analysts who believe Bitcoin may become a replacement for both individuals and sovereign treasuries when the current fiat money scheme of dollars, euros, and yen finally collapses, and this in turn could see one of the most important aspects of Bitcoin lose out as the derivative markets force inflation artificially onto a currency built on avoiding this devaluating effect. Â And only time will tell what becomes of Bitcoin if the SEC approves its financialization this Friday, since it will mean that Bitcoin will become more of a speculative investment rather than an alternative form of money.
Kenneth Schortgen JrÂ isÂ a writer for The Daily Economist, Secretsofthefed.com,Â Roguemoney.net, and Viral Liberty, and hostsÂ the popular youtube podcast on Mondays, Wednesdays and Fridays.Â Ken can alsoÂ be heard Wednesday afternoons giving an weekly economic report on theÂ Angel Clark radio show.