Momentum for the idea of an bitcoin ETF linked to bitcoin is back in a big way. That is prompting some market observers to speculate on how such a fund, assuming it comes to life, will affect prices of the largest digital currency.
Indeed, bitcoin prices are rebounding as the Securities and Exchange Commission (SEC) conducts a public comment period on bitcoin ETFs.
In June, ETF sponsors VanEck and SolidX, a fintech company engaged in the bitcoin ecosystem, revealed plans for the VanEck SolidX Bitcoin Trust ETF (XBTC). That fund is targeted at institutional investors as it would debut with a share price of $200,000. That product would track an index linked to a group of bitcoin trading desks, possibly allaying some of the SEC’s prior concerns about funds linked to physical bitcoin.
To this point, the SEC has not approved any of issuers’ efforts to launch bitcoin ETFs. Recently, the Winklevoss brothers, the brothers that are looking to introduce the first U.S. bitcoin exchange traded fund, the Winklevoss Bitcoin Trust, were awarded a patent that some believe could help that ETF finally come to life.
Hope Springs Eternal for Bitcoin Bulls
Predictably, bitcoin bulls largely favor an ETF linked to the king of cryptocurrencies, a sentiment largely rooted in the notion that the fund would stoke higher prices and wider acceptance of digital currencies.
“Should the approval for a Bitcoin exchange-traded fund succeed, the cryptocurrency market could potentially experience a never-before-seen influx of capital as institutional capital, speed traders, and accredited investors move into the crypto space for the first time,”.