As the pressure mounts for Bitcoin ETFs to be approved, one organization says it will never go down that route until bitcoin and the cryptocurrency space become more “legitimate.”
Bitcoin exchange-traded funds (ETFs) have been edging their way into the crypto market for months. While none have been approved just yet, the one getting the most attention was submitted by VanEck SolidX.
Read: What is a Bitcoin ETF?
The Securities and Exchange Commission (SEC) – the organization responsible for approving and governing cryptocurrency-based ETF platforms – has consistently sought information from both the public and industry experts regarding whether the ETF will attract business. Though it has delayed its decision-making process several times, the body does seem to be gathering the information it needs to offer a viable answer.
The important thing to take from this scenario is that the SEC is not saying no outright. While it very much has this power, it’s taking the time to understand and ponder the possibilities, and from there, we can likely expect solid reasons behind whatever choice it makes in December.
Some Won’t Get Their Hands Dirty
Though companies like VanEck have been working hard for extended periods of time to get their ETF projects off the ground, others are hesitant to even enter the space out of concern that bitcoin is not stable or mainstream enough. One such company is BlackRock, one of the world’s largest asset management companies.
CEO Larry Fink recently commented in an interview that he sees a lot of potential in bitcoin’s underlying technology, blockchain, though he believes it will be some time before bitcoin is stable enough to warrant an ETF or similar venture. He comments:
“I do see one day where we could have electronic trading for a currency that could be a store of wealth, but right now, the world doesn’t need a store of wealth unless you need that store of wealth for things you should not be doing.”
Bitcoin – Is It Used by the Wrong People?
Fink – like many Wall Street players – implies that bitcoin, given the alleged anonymity that comes with its usage, is still being utilized to purchase black market goods such as drugs, guns and other illicit products. For the most part, he believes bitcoin remains the most popular currency among criminals.
Furthermore, he says that the general “independence” bitcoin offers its users is going to make it very hard for governing bodies to accept it as a valid financial entity. He explains that once the industry is “legitimate,” he and his company would very much consider offering a bitcoin ETF, and he doesn’t want to say “never” so early in the game. However, he does state:
“It will ultimately have to be backed by a government. I don’t sense that any government will allow that unless they have a sense of where that money’s going for tax evasion and all of these other issues.”
Blockchain Is a Powerful Tool
As mentioned before, however, he does believe blockchain technology will garner serious usage in the future, and he’s confident its benefits will be witnessed (and experienced) by several industries:
“We are a huge believer in blockchain. The biggest use for blockchain will be in mortgages, mortgage applications, mortgage ownership, anything that’s labored with paper.”
Fink is amongst several Wall Street know-it-alls – including Jamie Dimon of J.P. Morgan – to suggest that cryptocurrencies are not all they’re cracked up to be while praising the technology that supports them. Among the large tech companies presently working on new blockchain solutions are IBM, J.P. Morgan Chase, Facebook and Amazon, though these projects have little or nothing to do with digital assets and more with managing supply chains and data.