Here’s some good news! Financial Services Agency considering Bitcoin ETF approval is some news from Japan that is extremely bullish for the cryptocurrency ecosystem!
VanEck’s Bitcoin ETF is being considered by Japan’s FSA, and if approved, might have an impact on the US Securities and Exchange Commission’s decision!
The probabilities for a Bitcoin ETF in the US by February remains very low. Hester Peirce, a pro-cryptocurrency SEC commissioner, had previously said that investors should not wait on a Bitcoin ETF because the commission might take years to approve one.
Whether the ETF gets approved or not, the filing of the VanEck ETF will provide guidance and clarity on the subject.
In 2018, 12 Bitcoin ETF’s were submitted by the Winklevoss twins and three other companies. The Winklevoss twins tried to get approval to launch an ETF using their cryptocurrency exchanges while the companies who filed attempted to rely on the Bitcoin Futures Market for their ETF.
11 filings were rejected by the SEC because they believed that the exchanges and the futures market are not a significant enough size to justify an ETF.
The VanEck ETF would use data from the over-the-counter (OTC) market, which is believed to be bigger than the cryptocurrency exchange market in terms of volume and trading activity. Whether or not the ETF is approved or not, the SEC will evaluate the global cryptocurrency OTC market and consider narrowing regulatory frameworks in major overseas markets.
Jay Clayton, the SEC chairman, said that current safeguards and technologies used in cryptocurrency exchanges to prevent suspicious transactions are non-existent in overseas markets.
Those kinds of safeguards don’t exist in many of the markets where digital currencies trade.
Japan and the G20 have moved to regulate cryptocurrencies, with major Bitcoin and cryptocurrency markets implementing various safeguards. South Korea, for example, has implemented stricter rules than the US, specifically, prohibiting foreigners and unidentified individuals from trading cryptocurrencies with the Korean Won.
If Japan approves a Bitcoin ETF before the US, however, the possibility of the US government approving a Bitcoin ETF improves.
Japan is the only country so far to have integrated a national licensing program for cryptocurrency exchanges. The program allows only the few exchanges that are fully compliant with existing regulations to operate in the country.
Currently, the time frame of the FSA’s decision regarding the approval of Bitcoin ETF’s is uncertain. It may take many months for the government to reach a decision, but the groundwork and framework for a Bitcoin ETF to be approved in Japan remains higher than it is in the US.
To note, the SEC did deny the Winklevoss their Bitcoin ETF bid. We’ve noted before how strict the SEC plans on being for ETF bids. We’ve also noted how intensely the SEC is looking into promoters of cryptocurrency without proper disclosures.
What do you think? Do you think more regulations will bring on better market conditions and have institutional money flooding in? Do you think more regulations like Japan will bring forth a Bitcoin ETF in the states? Let us know on our Facebook Page!