Exchange Traded Funds, or ETFs as they are commonly known, play a key role in stock markets around the world. But two prominent cryptocurrency stakeholders feel that ETFs may not make an entrance in the domain by the end of the year, as detailed on the popular cryptocurrency show CryptoTrader.
An ETF, as described by Investopedia, is a “marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund”. For example, the ownership of a resource such as bonds or gold bars can be divided into shares and traded in a way similar to stocks by those who possess them.
The host of CryptoTrader, Ran NeuNer, chose to take opinions from Maja Vujinovic, the CEO of O Group and Dave Chapman from the Asian counter trading firm OSL. The former put forth that since ETFs do not necessarily bring liquidity, the crypto industry does not need them. She also added that they aren’t the only way by which institutional investors can be attracted to put their money in cryptocurrency.
When asked if ETFs will be approved to step into the crypto domain by the end of the year, she replied in the negative, further going on that,
“SEC will probably check with their counterparts somewhere else that it needs to go through… Various different organizations before an approval. I don’t see that happening by end of this year. Simple fact of human lack of ability. We are such linear learners and this technology is exponential, I think there’s a completeness balance here.”
From Chapman’s point of view, the SEC (Securities and Exchange Commission) does not see quality exchanges in the crypto space, which is why they have rejected ETF proposals so far.
Two popular ETFs that were proposed this year, Winklevoss Bitcoin ETF and the VanEck Solid X Bitcoin ETF barely saw any success as the former was rejected by the SEC whereas the latter sits waiting list.
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