Location : Wabbit Hole
Job/hobbies : Cayman Islands Actuary
|Subject: What the SEC Bitcoin ETF Decision Means for the Future of Cryptocurrency Sat Mar 11, 2017 4:44 pm|| |
|It was a show of bullishness to rival last week's run-up in Snap stock: The Bitcoin price suddenly jumped more than $100 on Friday morning, trading above $1300 per unit for the first time.|
For a fleeting moment at about 8:27 a.m.—more than an hour before the U.S. stock market even opened—the price of Bitcoin spiked more than 10% from the day before. The blockchain-based virtual currency briefly touched a new record price of $1325, continuing its recent surge amid anticipated SEC approval of the first Bitcoin ETF. A week ago, Bitcoin even surpassed the price of gold.
But in a reminder of just how fickle the market for such newfangled assets can be, just after 4 p.m. Friday, the Bitcoin price took a U-turn and plummeted to lows not seen in months, dipping below $1000 to as low as $980, after Bitcoin investors received some bad news from the U.S. Securities and Exchange Commission. That's a 35% swing in the Bitcoin price in the span of a day.
Bitcoin buyers were hoping that the so-called cryptocurrency, created through digital "mining," would soon become available on the open stock market in the form of an exchange-traded fund (ETF). That way, mainstream investors could purchase Bitcoin as easily as they can now buy Snap (snap) stock following Snapchat's IPO, theoretically pushing the Bitcoin price higher.
(Related: A Guide to This Week’s Big SEC Decision on the Bitcoin ETF)
But the SEC made a decision Friday to prevent the proposed ETF, the Winklevoss Bitcoin Trust, from joining a stock exchange, citing "concerns about the potential for fraudulent or manipulative acts and practices" in Bitcoin trading. The sponsors of the ETF, the Winklevoss twins known for their controversial role in the founding of Facebook (fb)), had proposed that the Bitcoin-only fund would trade like a regular stock under the ticker symbol "COIN."
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