The United States Securities and Exchange Commission (SEC) is once again postponing its verdict delivery on the VanEck Bitcoin ETF. The news has triggered mixed reactions as some experts were foreseeing a rejection which is a worse outcome than a delay, while a few Crypto enthusiasts were betting on the Bitcoin ETF getting an SEC greenlight.
The Federal Agency said on Monday, May 20, 2019, that the commissioners need 35 more days of factfinding to before making the final decision.
The VanEck Bitcoin ETF May Get The Greenlight
The May 20 SEC delay of issuing a verdict on the VanEck bitcoin ETF is not in itself a negative sign from two standpoints.
Firstly, the delay means that the SEC commissioners are divided on whether to deny or approve the VanEck bitcoin ETF which is leading to a deadlock that warrants an extension in deliberations on the matter. This is a sign that Cryptos are becoming a major contender in the mainstream financial space and experts are still theorizing on the use of Cryptos and their role in the financial economy.
Secondly, the SEC is buying more time to engage with the Bitcoin community to better understand their points of view on the ETF matter in order to make a decision that facilitate the trading of Bitcoin on Crypto exchanges.
The US SEC Is Probing The Risk Of Bitcoin ETF In The Financial Market
One of the factors that are necessitating the delay according to financial reports is the concern that approval of the VanEck Bitcoin ETF could disrupt the financial system. Because such as an event could devastate the US economy and the global economy at large, the, US SEC is approaching the issue with caution as it tries to establish a delicate balance between opening up the digital-based economy and protecting the traditional financial system.
The Volatility Of Bitcoin Is Coming Into Focus
The US SEC is extending the timeline of exploring the VanEck Bitcoin ETF to study the effect of Bitcoin volatility in the economy. It remains a grey area of what triggers Bitcoin bear cycles or bull runs amid theories that whales influence market dynamics to optimize their strategies.
Nevertheless, the proponents of the VanEck Bitcoin ETF make a case that Bitcoin futures ensure that traders utilize neutral market strategies. This thought portrays ETFs as having a stabilizing effect on Bitcoin that the SEC can approve of if their standpoint is that the “means justify the end”.
Is Bitcoin As Volatile As Many Critics Say?
In a few instances, the BTC/USD pair has been known to be less volatile than traditional commodities or indices such as the Nasdaq Index. Hence, the evidence shows that the SEC could err should it use the assumption of Bitcoin volatility to dismiss the VanEck Bitcoin ETF as the fact is one-sided.
Additionally, after the conclusion of the New York Consensus conference, Bitcoin is less volatile as it seeks to establish its price above $8,00 to consolidate the short-term rally.
In the meantime, the market is waiting for the US SEC to give its verdict after the 35 days. What will the US SEC conclude about the VanEck Bitcoin ETF and how will the price momentum change?