The SEC’s approval of a Bitcoin ETF is seen as a holy grail to soften the ongoing slide of the crypto market and finally flush new capital into the market. So far, all applications from different companies have been rejected. The CEO of Blackrock does not yet see the market ready for this and is unsure whether approval will take place in the near future.
Larry Fink, CEO of Blackrock, is making a name for himself a few months ago, when the rumour arose that Blackrock would enter the crypto market. Back then, Fink denied all speculation and only confirmed that Blackrock would set up an internal blockchain team.
At the New York Times dealbook conference on 01.11.2018 Fink described that he is unsure about a positive future of Bitcoin ETF’s. He questions the maturity of the crypto market and believes that the crypto currency industry is not yet ready for such a step (freely translated):
I don’t have the feeling that a government will allow the [Bitcoin ETF] if it has no idea where the money for tax evasion and all these other problems comes from and moves.
The image of Bitcoin has often been distorted by widespread negative reporting and associated with terrorist financing, money laundering or the dark web. The fact that the proportion of actual tax evasion and illegal activities is dwindling, however, has recently been confirmed by a series of public institutions.However,
Fink is not an exclusive opponent of the blockchain, but merely a sceptic of crypto currencies. He believes that one day there will be a digital currency for global trade, but only when the world is ready. Fink and Blackrock are strong blockchain advocates, as the company has a significant proportion of fixed income assets in its portfolio and there is a great benefit in the blockchain in managing these assets.
The blockchain is gaining ground in many countries and is enjoying increasing popularity in South Korea, China, Thailand and Singapore. The potential and the chances do not remain unrecognised by the industry, so that a progressive adaptation in many areas of the economy is the result.
The SEC has rejected many Bitcoin ETF applications since January this year on the grounds that “significant investor protection issues need to be considered before sponsors begin offering these funds to retail investors”. Whether these reasons are actually tenable or whether the approval is only artificially delayed remains pure speculation for the time being. With the launch of the Börse Bakkt or the approval of a Bitcoin ETF in the first quarter of 2019, many experts in the industry expect another Bitcoin bull run and thus increasing interest in crypto currencies worldwide. Whether and when the events will actually occur remains to be seen.