The United States Securities and Exchange Commission (SEC) has officially approved Exchange-Traded Fund (ETF) transactions for Bitcoin, as stated in a recent announcement on their official website.
This approval marks a significant step for the world’s most popular cryptocurrency.
Following the SEC’s announcement, the Chicago Board Options Exchange (CBOE), the largest options exchange in the U.S., declared its plans to commence ETF transactions for Bitcoin starting tomorrow. Consequently, this decision legalizes fund trading in Bitcoin futures.
So, what does it mean for Bitcoin to start ETF transactions, that is, to trade funds?
Previously, to engage in any transaction involving Bitcoin, one had to directly own the cryptocurrency. However, with the SEC’s recent approval of ETFs for Bitcoin, the Chicago Board Options Exchange (CBOE) will introduce one or more spot Bitcoin exchange-traded funds for trading. This development enables transactions with investment products linked to Bitcoin without the necessity of directly purchasing the cryptocurrency.
Investors now have the option to invest in these funds instead of buying Bitcoin outright. The Bitcoin ETFs that have received approval from the SEC include:
- BlackRock
- Ark Invest
- Grayscale
- VanEck
- Bitwise
- Fidelity
- Hashdex
- WisdomTree
- Invesco Galaxy
- Franklin
- Valkyrie
Why did the SEC approve Bitcoin funds out of the blue?
Indeed, the SEC’s approval of Bitcoin ETFs didn’t come as a complete surprise to the industry. There has been anticipation for some time that the SEC would greenlight Bitcoin ETFs.
In fact, this expectation has been one of the factors driving Bitcoin’s value up to around $47,000. The prospect of Bitcoin being traded on mainstream financial markets has reignited investor interest in the cryptocurrency.
With this decision, there’s a possibility that Bitcoin’s value might rise further. However, it’s important to note that the SEC, in its statement approving the ETFs, has emphasized that Bitcoin remains a highly speculative investment tool.
As such, it would be imprudent to make investment decisions based solely on the news, with expectations that “Bitcoin will soar.”
For those interested in reading the SEC’s comprehensive statement on this matter, it can be accessed via their official website.
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