Bringing Bitcoin to institutional investors has proven to be a challenge. More specifically, there are no official ETFs which gained regulatory approval so far. According to Cathie Wood, CEO of ARK Investment Management, that is only a temporary trend. However, she is confident we will see an approved Bitcoin fund before an ETF. That is a rather interesting statement, to say the very least.
Everyone knows Bitcoin ETFs are struggling for regulatory approval. The SEC has rejected various of these applications for multiple reasons so far. It is highly unlikely that situation will change in the very near future. After all, Bitcoin remains unregulated and the financial sector continues to oppose cryptocurrency. That doesn’t mean investors don’t want access to traditional investment vehicles, though.
No Bitcoin ETF Without Regulation
A closed-end fund before a Bitcoin ETF sounds far more logical, on paper. It has less regulatory requirements and still provides investors with access to Bitcoin. All of this is done without investors having to buy Bitcoin as well. The chances of such a fund getting approved before ETF approval makes a lot of sense. There is still a lot of education to do when it comes to a Bitcoin ETF. For now, it will remain a utopian dream.
It is highly unlikely an ETF can succeed without regulatory approval in the US. Various financial overseers would have to agree on regulating cryptocurrency in a positive manner. For now, that seems highly unlikely. Moreover, there is the question of Bitcoin being a security or not. While people may argue BTC is a currency, that will not be how the SEC sees it. Then again, nothing has been set in stone just yet, by the look of things.
Regardless of how things play out, investors want exposure to Bitcoin. Whether it is a fun or an ETF, they will successfully do so in the end. No one can prevent people from getting exposed to Bitcoin in a manner they see fit. A strong ecosystem will be in the best interest of regulators as well. For now, it is a matter of figuring out how things will play out. The demand for Bitcoin is there, though, that much no one can deny.