American investors have a soft landing in the face of the U.S. Securities and Exchange Commission’s (SEC) refusal to license a Bitcoin Exchange Trade Fund (ETF). Bloomberg has reported an exchange noted christened the Bitcoin Tracker One that is listed and regulated in Sweden in U.S. Dollar using the CXBTF tickers.
The Bitcoin Exchange Trade Note (ETN) that has been trading on NASDAQ’s Stockholm exchange since 2015 is now entering the U.S’ cryptocurrency market allowing U.S.-based investors to buy Bitcoin indirectly. Explaining the development, CoinSahres Holdings CEO Ryan Randlof told Bloomberg:
“Everyone that’s investing in dollars can now get exposure to these products, whereas before, they were only available in euros or Swedish krona […] given the current climate on the regulatory front in the U.S., this is a big win for Bitcoin.”
Exchange-Traded-Notes (ETNs) are debt instruments backed by issuing banks and can potentially replace Grayscale’s Bitcoin Investment Trust owing to their significantly lower rate compared to Grayscale’s products.
With the hope of establishment of the much-awaited Bitcoin ETF dimming, there has been a growing demand for the launch of a crypto-related ETF. There has been a sense of urgency, especially because of interest by institutional investors to enter the cryptocurrency market without getting involved with the insecurities and irregularities associated with the crypto market.
The new move gives American investors the option to trade in digital currencies in a foreign listed asset using U.S. dollars. Investors will execute trades in U.S. dollars but the clearance, holding, and settlement will be done in Sweden.
SEC recently rejected a proposal by the Winklevoss twins to establish a Bitcoin ETF, holding off the decision until later. SEC has stood its grounds of refusal for licensing ETF’s blaming manipulation and fraudulent practices underlying the market:
“The Commission believes that, in order to meet this standard, an exchange that lists and trades shares of commodity-trust exchange-traded products (“ETPs”) must satisfy two requirements; first, the exchange must have surveillance-sharing agreements with significant markets and second, those markets must be regulated.”
This is welcome news in the cryptocurrency market as it will attract institutional investors and pave way for the establishment of ETFs besides creating a positive opinion of the crypto space resulting in the betterment of the market.