SEC to Weigh Whether Bitcoin Futures Market could Accommodate ETFs

The US Securities and Exchange Commission (SEC) is “strongly” advising the investors of mutual funds with holdings in Bitcoin futures to beware of risks.

While getting increasingly popular, these derivatives are based on a crypto asset that is “highly speculative” and volatile, trading in a lightly regulated market, said the SEC's division of investment management on Tuesday in a statement.

Investors must weigh their appetite for risk and examine the fund’s disclosures, the agency said.

“Investor protection and assessing the ongoing compliance of these funds is a top priority for the staff.”

These warnings from the SEC came a week after the new chief Gary Gensler told lawmakers that the crypto market “could benefit from greater investor protection.”

While Gensler didn’t mention Bitcoin in his testimony, on Tuesday, SEC said it would “consider whether, in light of the experience of mutual funds investing in the Bitcoin futures market, the Bitcoin futures market could accommodate ETFs.”

An ETF would mean “less volatility & higher regulated volumes,” said trader and economist Alex Kruger. Moreover, proponents of such a vehicle also say this would bring in a new wave of investors in the bitcoin market just like it did in gold, whose price never went under $400 after the first gold ETF (SPDR) was listed by NYSE in November 2004.

The agency also said staff would scrutinize the Bitcoin futures market to judge whether it “appropriately” supports mutual fund investments in the derivatives. It will also look at funds’ ability to liquidate their derivatives in the crypto asset and review funds’ valuations of holdings.

Sourse: bitcoinexchangeguide.com

Start mining bitcoin now

Start trading bitcoin now

Category: News | Views: 128 | Added by: danyagames2007 | Tags: #Bitcoin #Bitcoin Price #BTC | Rating: 0.0/0
Total comments: 0
Name *:
Email *:
Code *:
China's measures take wind out of Bitcoin's sails (0)
Bitcoin enters 'death cross' amid China crackdown (0)
Bitcoin briefly crashed again, wiping out 2021 gains. Here's why. (0)
El Salvador’s Bitcoin move is unconstitutional, new lawsuit says, amid claims the President is getting cold feet (0)
Peter Schiff Unveils Best Time to Buy Bitcoin – It’s About MicroStrategy (0)
Bitcoin Bull Mike Novogratz on Chinese Crackdown: "Will Take Some Time to Play Out" (0)
Jim Cramer sells 'almost all' of his bitcoin as prices hit 2-week lows on China crackdown (0)
Cryptocurrencies tumble amid China crackdown on bitcoin miners (0)
Ether Plunges Below $2K, Bitcoin Dips to $32K (0)
U.S. Bitcoin Mining Firm Pioneers Alternative Flare Gas Energy (0)