SEC Warns of Bitcoin Futures Risks in Mutual Fund Investments

(Bloomberg) -- The U.S. Securities and Exchange Commission has a blunt message for investors in mutual funds that have holdings in Bitcoin futures: Beware of the risks.

While the derivatives have become increasingly popular, they’re still based on an asset that’s “highly speculative” and volatile, and which trades in a lightly regulated market, the SEC’s division of investment management said Tuesday in a statement. Investors should 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,” the SEC said.

The warning comes just weeks after Gary Gensler, who taught classes on digital assets at the Massachusetts Institute of Technology, took over as SEC chairman. His early comments have thrown cold water on speculation that the SEC would quickly approve a Bitcoin exchange-traded fund. Last week, he told lawmakers that the cryptocurrency market “could benefit from greater investor protection.”

On Tuesday, the 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.” The agency also said staff would:

Scrutinize the Bitcoin futures market to judge whether it “appropriately” supports mutual fund investments in the derivatives
Look at funds’ ability to liquidate their derivatives in the cryptocurrency
Review funds’ valuations of holdings

Sourse: bnnbloomberg.ca

Start mining bitcoin now

Start trading bitcoin now

Category: News | Views: 132 | 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)