SEC delays VanEck SolidX ETF decision

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Yesterday December 7, The SEC (Securities and Exchange Commission) yet again delayed the decision of VanEck and SolidX proposed Bitcoin ETF (Exchange traded fund). The review period is extended until next year, February 27. 

This time is different because the SEC can no longer delay this decision. The end of February will be the time and date when we finally find out the outcome of the SEC decision. Meaning, that they will either approve or disapprove the ETF.

Previous denials

The SEC is famous for denying Bitcoin ETFs. First they denied the Winklevoss twins Bitcoin ETF. Then they denied nine Bitcoin ETF proposals by ProShares, Direxion and GraniteShares. It was all due to a reason that these products do not comply with he requirements by the “Exchange Act Section 6(b)(5), in particular, the requirement that a national securities exchange’s rules be designed to prevent fraudulent and manipulative acts and practices.

SEC Commissioner comes into play

Later on, the SEC Commissioner Hester Peirce tweeted that it was not the SEC commissioners who actually denied the ETF proposals, instead, they delegated that responsibility to SEC staff, namely, the Division of Trading and Markets. She wrote: “The Commission (Chairman and Commissioners) delegates some tasks to its staff. When the staff acts in such cases, it acts on behalf of the Commission. The Commission may review the staff’s action, as will now happen here.”

And this was the decision which put the proposal into its next phase – comment phase. The SEC was waiting for the public to comment on this issue until November 5. To this day, the SEC has recieved more than 1,600 comments, reports CoinDesk.

VanEck optimistic about the outcome

VanEck from the beginning has expressed much optimism about the products potential despite the regulatory “rocks” in the way. Their director of digital asset strategy, Gabor Gurbacs said that the ETF approval is just around the corner.

“We are the closest that we can be. It is very clear to me that America wants a bitcoin ETF and we are here to build it. I say bitcoin is digital gold, and we should not dismiss a potential opportunity for the next financial system” he expressed during an interview on Fox Business.

Is such optimism healthy for you? I guess we will just have to sit back and wait the 27th of February to see for ourselves. 

Source:

https://goo.gl/jmiofd
https://goo.gl/qr27TA

Photo by Essow Kedelina from Pexels

Bakkt sets launch date for Bitcoin future trading!

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12th December is the date when Bakkt Bitcoin Futures trading is set to launch.

Bakkt is an open-source global investing platform which wants to make the access, trading, and use of digital assets much more comfortable and faster for users. Their parent company ICE (Intercontinental Exchange) which is the owner of NYSE (New York Stock Exchange), just recently revealed that the Bakkt Bitcoin daily futures contracts would begin trading on December 12th. The official announcement, published on October 22, says: “The Bakkt Bitcoin (USD) Daily Futures Contract is a physically-settled daily futures contract for bitcoin held in Bakkt LLC, ICE’s Digital Asset Warehouse, and will be cleared by ICE Clear US, Inc.” Further explaining that “Each futures contract calls for delivery of one bitcoin held in the Bakkt Digital Asset Warehouse, and will trade in U.S. dollar terms. One daily contract will be listed for trading each Exchange Business Day.”

These are generally good news for crypto investors, as a lot can change from this point on.

First of all, the SEC (Securities and Exchange Commission) might change their position on this market about Bitcoin ETF approvals, as they base their opinion on the fact that the BTC futures market is not sufficiently liquid. Bakkt might change that.

Secondly, the entrance of Bakkt might substantially increase the movement of the market in a good way, as a lot of Bakkt clients now would be able to invest in Bitcoin.

Thirdly, Bakkt is planning to provide all sort of solutions for crypto investors. The company’s CEO Kelly Loeffler said that Bakkt is looking into providing solutions for buying, selling, storing and spending digital assets – all in a decentralized ecosystem. Also, Jeffrey C. Sprecher, the Founder, Chairman and CEO of ICE said: “In bringing regulated, connected infrastructure together with institutional and consumer applications for digital assets, we aim to build confidence in the asset class on a global scale, consistent with our track record of bringing transparency and trust to previously unregulated markets.”

However, as expected from last years predictions, this is the year when the crypto market class is seeing a notable recognition. It is becoming more and more regulated, and large commissions and organizations are looking up to it. The only thing I’m not sure about is how a company of such scale and power can provide a decentralized platform for crypto operations.

Are all these regulations, ETFs and futures markets going to be good for the industry? Sometimes it feels like we are capable of everything to see a little bull-run. What are your thoughts?

Source:

https://goo.gl/u5rhGD
https://goo.gl/vk4gGD – The Official Announcement.
https://goo.gl/pQATS3

Photo by Canva.com

The United Arab Emirates plans to introduce ICOs by 2019.

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On October 8, the head of securities regulator of The United Arab Emirates (UAE) have announced that they are going to introduce ICOs to provide companies with a new way to raise money.

Since the oil price has been low and the equity markets weak in the past years, IPOs have seen a severe downgrade in the UAE and the Gulf Arab region as a whole.

“The board of the Emirates Securities & Commodities Authority has approved considering ICOs as securities. As per our plan we should have regulations on the ground in the first half of 2019,” explained the Acting Chief Executive Officer of the Securities and Commodities Authority (SCA) in the United Arab Emirates, Obaid Saif Hamad Al Zaabi, continuing that “ESCA is drafting regulations for ICOs with international advisers and is working with the Abu Dhabi and Dubai stock markets to develop trading platforms for the offers.”

Basically they are calling all ICOs securities, which goes together with the U.S. SEC statement that ICOs can be securities only if they are “based on specific facts, and fall under the SEC’s jurisdiction of enforcing federal securities laws,” says in the definition by SEC.

This is an open statement to the crypto community, as a lot of people are disagreeing with the fact that all ICOs could be defined as securities. If so, that would mean that ICOs could fall under the regulatory rules for securities. And it looks like this could happen in the UAE, when the new law will take place in early 2019.

What do you think? Are all ICOs securities with a few exceptions?

Source:

https://goo.gl/CwaJAF
https://goo.gl/ySPQUP
https://www.sec.gov/ICO

Photo by Canva.com

SEC temporary suspends Bitcoin Tracker One and Ether Tracker One

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On Sunday, September 9, 2018, The Securities and Exchange Commission announced the temporary suspension of trading in the securities Bitcoin Tracker One (CXBTF) and Ether Tracker One (CETHF) til September 20, 2018.

SEC temporary suspends Bitcoin Tracker One and Ether Tracker One

On Sunday, September 9, 2018, The Securities and Exchange Commission announced the temporary suspension of trading in the securities Bitcoin Tracker One (CXBTF) and Ether Tracker One (CETHF) til September 20, 2018.

The official statement says:
“The Commission temporarily suspended trading in the securities CXBTF and CETHF because of confusion amongst market participants regarding these instruments. This order was entered pursuant to Section 12(k) of the Securities Exchange Act of 1934 (Exchange Act).”

The SEC claims that all this has been done in the interests of “the public” and that their mandate is to ensure “the protection of investors.”

A lot of tweeters are frustrated that these kind of news come in the middle of Sunday, which usually happens during work days.

“You guys are officially losing your grip. Announcing news on a sunday during low volume and weekly close,” says @Brettloug in the SEC announcement thread.

Another tweeter @trajanmex wanted to clear the air by saying: “Relax, this is just because there is confusion between people conflating the different asset classes. This is a temporary suspension and will resume September 20th.”

Source:
https://goo.gl/4P6F8M

https://goo.gl/ML7Urp – The official statement

United States SEC rejected 9 Bitcoin ETFs

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On Wednesday, August 23, nine inquires from three companies – ProShares, Direxion and GraniteShares, were all denied because of the same reason. The decision is still under review, but the main reason is that the products offered by these companies, does not comply with the requirements by the “Exchange Act Section 6(b)(5), in particular, the requirement that a national securities exchange’s rules be designed to prevent fraudulent and manipulative acts and practices.”

Later on, the SEC Commissioner Hester Peirce tweeted that it was not the SEC commissioners who actually denied the ETF proposals, instead, they delegated that responsibility to SEC staff, namely, the Division of Trading and Markets. She wrote: “The Commission (Chairman and Commissioners) delegates some tasks to its staff. When the staff acts in such cases, it acts on behalf of the Commission. The Commission may review the staff’s action, as will now happen here.”

ETFs are marketable securities that track an index, commodity, or basket of assets, that are proportionately represented in the fund’s shares. ETFs experience price changes throughout the day as they are purchased or sold on a stock exchange. If the SEC allows a BTC ETF, a fund would purchase an underlying amount of actual BTC and distribute those funds into shares, which further are distributed to shareholders.

The rejection of these nine ETFs comes only weeks after the Winklevoss bitcoin ETF was denied – a decision SEC Commissioner Hester Peirce strongly disagreed with. Which might be the reason she is receiving good words from the crypto community in her twitter: “Hester we “heart” you! This is needed now more then ever. It’s a stepping stone toward the legitimacy needed for this technology to continue to grow, not just financially. Hopefully moving forward more will become correctly educated, because there seems to be quite lacking in DC”, says tweeter with a username @seanyg73. But on the other hand the conversation shifts towards a different opinion: “5 votes are against her. Review don’t mean anything.. Lets get over it and move on… This will again stall the market and at the end we will get a “dissent” note…”

I could agree on both sides of the argument. If she has 5 against 1 votes by default, then the logical action would be to drop it and work on a new proposal. Otherwise, it would just take too much time. And that time would be needed for making a new proposal.

Another thing what tweeters are writing about is: “An ETF that doesn’t buy actual BTC is not good for crypto” where the response was – “True. But approving any of these gives a good direction as to what will happen with CBOE+Van ETF. I think that is the main course. These are appetizers in crypto world,” which is true. We need mass adoption for Bitcoin and crypto related issues, and this is the way we are slowly moving towards it. Already the daily plan for SEC has been disrupted because of these continuous BTC ETF proposals. It’s coming sooner or later.

Do you think we need a BTC ETF, where the amount of BTC is distributed into shares and shareholders? Do we need a BTC ETF in general? What are your thoughts?

Source:

https://goo.gl/q17fgK

https://goo.gl/MskWpE

https://goo.gl/hegko6

https://goo.gl/QaBY1V – the original SEC document

Photo by Wikimedia Commons

SEC shuts down a scam project and fines it $30k

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SEC recently found a suspicious project called “Tomahawk Exploration LLC”. Tomahawk promised its investors to be an intermediary and convert their funds into the shares of the company specializing in oil production. The prices of oil would go up, and the investments would grow correspondingly.

The Commission has shut the company down with a fine of $30k, also the ex CEO of Tomahawk is not allowed to hold any leading positions of any enterprise or own any company shares.

Source:
https://goo.gl/hFkAA7

Ripple more likely to be a security

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Just a few days earlier when two SEC officials came out with a statement about Bitcoin and Ethereum not qualifying as securities, people are starting to discuss the fate of Ripple (XRP) now. Ripple still remains the top 3 coin, but somehow it got left out of the SEC discussion. This might be because the sale of these tokens helps the company – Ripple. And that is a definition of a security. This is why Bitcoin and Ethereum has been labeled – utility tokens. CrytpoDaily says that: “the blowback from a verdict labelling Ripple (XRP) as a security could be huge and may bring down the entire market with it.”

Investors are worried about the future of Ripple, since Western Union came out saying that the Ripple xRapid service is “far more expensive” and that they “might not be using it anymore.” Western Union is a 167-year old money transfer company that provides service to customers in 200+ countries. The Company’s CEO Hikmet Ersek told that “while his company is still experimenting with Ripple’s product xRapid for payment settlements, it has not saved money so far”, but then adding “that the pilot may be too early on and “too small” to draw conclusions, as Western Union has only tested the cryptocurrency for transfers between two currencies – U.S. dollars and Mexican pesos, so far.”

The problem with Western Union and Ripple is that they did only 10 transactions during the pilot, but Ripple calculates that if they expanded the the pilot to all of their payments, the company could cut down at least 50% of costs per transaction. This has been proven in previous pilot tests with Viamericasand Mercury FX, when the xRapid reduced costs by 40 to 70%.

Source:

https://goo.gl/Pbf3oh
https://goo.gl/s7wVsd
https://goo.gl/DNSf25
https://goo.gl/K37j6p

“ICOs are securities”, Jay Clayton

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In an article, published today, SEC (Securities and Exchange Commission) chairman Jay Claiton stated that initial coin offerings are securities and should be controlled by regulations. This was said in a public forum organized by SEC. While the overall tone of the blockchain technology in Claytons speech was set in a positive tone, his position towards ICOs remained unchanged. Clayton has described ICOs as securities on multiple occasions. 

John McAfee couldn’t stay quiet and answered to this article: “I will not now, nor will I ever, accept this as a reality. I am submitting, now, to this law, but I will fight with every last breath to ensure that this absurd overreach by the SEC will not stand!! It will not stand!”

He strongly disagrees and believes that the majority of ICOs do not meet the Supreme Court Howey Test for securities. He challenged Clayton to a live debate on CNN. He has challenged governmental authorities on a live debate before. 

“Flood this mother fucker’s voice mail and inbox with demands that he debate me. CNN is ready! Show this prick what the crypto community is all about!” tweeted McAfee.

John is taking up the position of being a crypto warrior, a lot of tweeters say. Some tweet that “..you can’t regulate something that’s not on your soil. Crypto is global. Crypto does not belong to a government, it belongs to the people”, while others tweet that “It’s not overreach, ICO’s are quite obviously securities, they’re attempts to raise capital from the market. You don’t get to avoid the law because it’s inconvenient.”

It’s clear that there is still some work to do regards this question, as it’s uncertain to a lot of people and the SEC in general.

What are your thoughts? 

Source:

https://goo.gl/T77PSU
https://goo.gl/urF63P
https://goo.gl/EEYyA4

Photo by Wikipedia.

Coinbase to become a broker dealer

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The worlds most trusted cryptocurrency platform Coinbase has initiated a process of becoming a licensed, fully regulated broker dealer. With this move they are showing their willingness to participate in non-crypto financial products. According to an announcement published in their blog (blog.coinbase.com), the company said its looking to “work with regulators to tokenize existing types of securities”. As the approval is still pending, Coinbase claims that “If approved, Coinbase will soon be capable of offering blockchain-based securities, under the oversight of the US Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA)”. 

All this means that we will have a much more regulated, but safer crypto ecosystem where Coinbase could offer stocks. All this is possible because Coinbase acquired Keystone Capital Corp.(trading platform, a registered broker-dealer, has licenses to operate as a registered investment adviser), Venovate Marketplace, Inc.(investment platform), and Digital Wealth LLC(financial planning and investment management platform). Overall, those are some big steps towards bringing blockchain to the regulated financial services industry. 

Source:

https://goo.gl/mSN3op
https://goo.gl/VQKrSQ