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SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

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Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#131

Post by dnautics »

gregshap wrote: post #66

So what are the expected benefits of a bitcoin ETF? Many of the traditional benefits of ETFs are obsolete when you can just buy and hold an equivalent amount of bitcoin The biggest benefit I can think of is that some institutional investors have restrictions on the types of securities that they can buy. Someone could solve this by creating a company to buy lots of bitcoin, and then having an IPO to list that company…

> Someone could solve this by creating a company to buy lots of bitcoin, and then having an IPO to list that company on a public market. Then pension funds would be allowed to buy it, Jane Doe could buy some in her IRA, etc.

You're repeating yourself. That is more or less what an ETF is.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#132

Post by pmorici »

problems wrote: post #4
JamieF1 wrote: post #2

Yet the price has only dropped around 80 dollars compared to yesterday. Not too bad. For a few minutes it dropped by around 250 dollars but it picked up quickly somehow.

It just happened, not many people are aware of this news yet and Bitcoin tends to be volatile as all hell, give it a few days to sort itself out.

The publicity from this, even though it was a negative decision, will be a hugely positive to the price in the medium term. For reference Go look at what happened after the Silk Road take down, or the Chuck Schumer news conference where he told the world he just learned how you could buy drugs for Bitcoin.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#133

Post by olegkikin »

Analemma_ wrote: post #100
slg wrote: post #80

Earlier quoted context omitted.

>Bitcoin just went from a high of 1327.1926 to 995.9575 in the blink of an eye. That is a loss of 25% of its value. This announcement does nothing to hurt the utility of Bitcoin or its application as a medium of exchange. That drop certainly seems like a speculative investment bubble popping.

Yup. Any "currency" that can plummet in value by 25% because of a minor SEC ruling is not ready to be a store of value.

It's not minor. If the ETF were approved, billions of dollars would flow into bitcoin through the retirement funds, which now can't. So that +25% was baked in, that was the expectation of the appoval. Lots of people were hoping for it. Oh well.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#134

Post by elastic_church »

chollida1 wrote: post #18

Bitcoin just went from a high of 1327.1926 to 995.9575 in the blink of an eye. Wow. From the ruling.... > First, the exchange must have surveillance-sharing agreements with significant markets for trading the underlying commodity or derivatives on that commodity. And second, those markets must be regulated. > Based on the record before it, the Commission believes that the significant markets for bitcoin are unregulat…

The irony here is that CME Group - which provides futures and derivatives - is waiting on the sidelines watching if an ETF like this could get approved and sustain a liquid market before providing bitcoin futures.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#135

Post by elastic_church »

dragonwriter wrote: post #79
subverter wrote: post #49

Coin Center executive director Jerry Brito: > The Winklevoss ETF proposal was rejected because the SEC found that the significant markets for Bitcoin tend to be unregulated overseas markets that are potentially subject to price manipulation. But this creates a chicken and egg problem. How do we develop well-capitalized and regulated markets in the U.S. and Europe if financial innovators aren’t allowed to bring produc…

The SEC's job (relevant to the issue at hand) is not to make it easy to drive demand in the US on the hopes that that might create conditions for mature markets in $COMMODITY, it is to assure that exchanges listing derivatives of $COMMODITY have adequate rules in place to protect against manipulation, including manipulation of the derivative through manipulation of the underlying commodity. If the key driver for dome…

Yeah, you willingly ignored all the incumbents sitting on the sidelines that rely on validation from the regulators.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#136

Post by chillacy »

zeusk wrote: post #88
EGreg wrote: post #59

Earlier quoted context omitted.

I put a 50x leveraged short contract trade 10 mins before that at BitMex, and just before it plummeted, it quickly went up to 1327 and I got wiped out. So I didn't get to make a huge return!

> 50x leveraged short contract This is partly why SEC wants underlying to be regulated.

What's stopping him from doing a similar thing by selling deep OOTM options off of money he borrows on his margin account at any other broker?

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#137

Post by olegkikin »

tormeh wrote: post #86

Can't they just file in another country? I mean, it doesn't really matter where it's traded; any decent bank will give you access to at least the LSE and Xetra in addition to the two big American exchanges.

It matters, because the US retirement funds (401k, IRA) can't invest into some other country's ETFs, correct me if I'm wrong.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#138

Post by timothycrosley »

kolinko wrote: post #116
stOneskull wrote: post #92

Earlier quoted context omitted.

gold is a precious metal. bitcoin is a text file.

a property ownership is also a text file

Ehhh, I call BS. If for some reason all of a cities property records were lost, they would rebuild them via community testimony and consensus at worst case. Which clearly demonstrates it works in the opposite direction of what you are implying. Also property ownership tends to have inherit utility, something bit coin does not.

Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]

#140

Post by danielweber »

Analemma_ wrote: post #129
danielweber wrote: post #124

Earlier quoted context omitted.

Eehhh, I've been skeptical of Bitcoin in the past because of its volatility, but this is very unusual. It's been rather stable on a week-to-week basis for a long time.

The SEC declining to approve some investment vehicle is not unusual at all. Compare that to the USD, where nothing short of global nuclear war is going to cause a 10-minute 25% swing.

"This is unusual" is "the 25% drop." Over the past year, it's been pretty boring.
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