Bitcoin ETF And The SEC: Prepare For The Worst
September 30th is what many crypto traders and enthusiasts have marked as their D-Day. This is due to the fact that the SEC is meant to rule on the CBOE sponsored Bitcoin ETF by that date. The question on many crypto enthusiasts’ minds, is whether we will see a rejection or if the SEC’s rules have room for another postponement. But with the current Bitcoin (BTC) and general crypto market decline in the last 24 hours, it is safe to conclude that the SEC will also play it safe by not approving an ETF anytime soon.
Anthony Pompliano, Founder and Partner at Morgan Creek Digital, tweeted about the current events in the crypto space. He stated the following:
“Want to know why there isn’t a crypto ETF approved yet?
We just saw $100 million of Bitcoin dumped on the market in less than 10 minutes.
It caused more than a 5% decline in BTC price. Some argue volatility, others argue manipulation.
The truth is no one knows.”
The Mandate of the SEC
Given the last few hours of the crypto market turmoil, it is a good exercise to remind ourselves what exactly the SEC does. The full title of the authority is the U.S Securities and Exchange Commission and they are tasked with protecting American investors from market volatility and unfair practices by those with the leverage to do so in the traditional stock markets.
The SEC’s Mission is:
“To protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.”
It cannot get any clearer as to what the SEC is tasked with doing. With many crypto portfolios of HODLers dropping by an average of 20% in the last 24 hours, some wish that the SEC had a reach to investigate what just happened in the said time period. But with crypto being decentralized and the United States yet to issue concrete regulation within its jurisdictions, the SEC trying to regulate crypto is like a soldier going to battle with a broomstick! They simply have no laws or rules to work with.
Bitcoin ETF on September 30th?
Many crypto traders have marked their calendar for the SEC deadline of September 30th to make a ruling on the CBOE sponsored Bitcoin ETF. Many hope that by that time, the SEC would have changed their tune of constantly rejecting Bitcoin ETFs on their ‘in tray’.
Prepare for the Worst
Therefore, it would be prudent for many crypto traders to prepare for the worst as we head towards that deadline. A few plausible options are outlined below. Please note that we are not financial advisers. We are observant enthusiasts like you. All the choices below are dependent on individual risk tolerances. Therefore, there is no pressure to abide by any.
- Keep HODLing despite the recent happenings with a 10 to 20-year vision that the crypto market will grow to be valued in the trillions of dollars
- Another option would be set comfortable stop losses should anything happen due to an SEC announcement
- Learn to short BTC and ETH like the pros and head to BitMEX for some nonstop action
- Buy the Dip
- Completely cash out till after the SEC make an announcement
- Totally ignore all the above options
In conclusion, the fact that Bitcoin and other cryptocurrencies are bleeding in the markets is one more reason the SEC might not approve a Bitcoin ETF anytime soon. Perhaps what they might end up doing – given the mission statement provided above – is lay the groundwork for total crypto regulation in the US. This way, if there was indeed an ETF backed by Bitcoin, then the latter would not be subject to possible manipulation as many have suggested has happened in the last 24 hours.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
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