The Securities and Exchange Commission (SEC) is expected to reject all spot ETF proposals bitcoin in January, according to Matrixport analyst Markus Thielen.
Thielen argues that the SEC has not yet been satisfied with the compliance measures taken by the filing companies.
SEC Chairman Gary Gensler has repeatedly expressed concerns about transparency and regulation of the cryptocurrency industry.
"There have been too many scams and bad actors in the cryptocurrency space," Gensler said last month. "There's a lot of non-compliance, not only with securities laws, but with other laws around anti-money laundering and protecting the public from bad actors there."
If the SEC rejects proposals for a spot bitcoin ETF in January, it will be a major disappointment for cryptocurrency advocates.
A spot bitcoin ETF would allow investors to buy and sell bitcoins through a traditional stock exchange platform.
The approval of such an ETF could help increase the liquidity and acceptance of cryptocurrencies in the United States.
However, Thielen believes the SEC is not yet ready to approve a bitcoin spot ETF.
“SEC Chairman Gensler is not embracing crypto in the US. and it may be too difficult to expect that he would vote to approve spot bitcoin ETFs,” Thielen wrote.
"This can be fulfilled by the second quarter of 2024, but we expect the SEC to reject all proposals in January."
However, today the SEC is planning meetings for the New York Stock Exchange Nasdaq and Cboe to finalize comments on Spots # Bitcoin ETFs, it states Fox Business.
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If the SEC does not approve the bitcoin spot ETF, there will be the following potential effects:
- It will be a major disappointment for cryptocurrency supporters. Cryptocurrency advocates believe that a spot bitcoin ETF will help increase the liquidity and acceptance of cryptocurrencies in the United States. The rejection of the ETF would be an indication that the SEC is not yet ready to embrace cryptocurrencies as a legitimate investment vehicle.
- It could lead to a temporary drop in the price of bitcoin. Some investors may be disappointed by the rejection of the ETF and sell their bitcoins. This could lead to a temporary drop in the price of bitcoin.
- It could delay the broader adoption of cryptocurrencies in the United States. The approval of a spot bitcoin ETF could help increase the transparency and liquidity of the cryptocurrency industry. The rejection of the ETF could delay the wider adoption of cryptocurrencies as investors look for other, safer investment options.
However, it is important to note that the rejection of the bitcoin spot ETF will not necessarily be disastrous for the cryptocurrency industry. Investors will continue to be able to buy and sell bitcoins through cryptocurrency exchanges. In addition, there are already several bitcoin ETFs approved in other countries, such as Canada and Europe. These ETFs can offer an alternative to investors in the United States who want exposure to bitcoin.
