Bitcoin-Based ETF Requests SEC Approval

While still volatile, and trying to shake the seedier side of its reputation, digital currency bitcoin has come a long way in a few short years. A few days ago, a move was made that could work to grow bitcoin’s financial legitimacy.

On Friday (Jan. 20), Grayscale Investments LLC — a unit of tech entrepreneur Barry Silbert’s Digital Currency Group Inc. — reportedly filed with the Securities and Exchange Commission (SEC), said The Wall Street Journal, to have its Bitcoin Investment Trust listed on the New York Stock Exchange. If the SEC were to approve the fund, it could increase awareness and grow interest in bitcoin among traders.

Given SEC approval, the bitcoin trust would operate as a traditional exchange-traded fund (ETF) with an asset class appeal similar to that of gold, said WSJ, which, like bitcoin, is considered a decentralized commodity.

A bitcoin-based ETF could tone down some of bitcoin’s more unpredictable tendencies, said WSJ, though it would still be a riskier investment overall. Needham Analyst Spencer Bogart was quoted as saying that, as such, the likelihood of a bitcoin-based ETF being approved by the SEC in 2017 remained low given its propensity toward volatility.

Initially, the Bitcoin Investment Trust will reportedly seek to launch with $500 million, the filing said, though that number is subject to change.

Bitcoin’s current estimated market cap is over $14.5 billion, with over 16 million total bitcoin in circulation, according to data from CoinDesk. A quick look around suggests most digital currency investors and analysts are still bullish on the digital currency’s long-term prospects, despite its continued propensity toward volatility.

As of now, speed traders armed with cutting-edge tech are reportedly driving some 80 percent of the bitcoin trading market. Much like their Wall Street counterparts, bitcoin speed traders buy and sell bitcoin as a quick click and make their margins in minuscule price discrepancies.