On March 11, the Securities and Exchange Commission (SEC) will make a ruling on the first of three bitcoin Exchange-Traded Funds (ETFs) that have filed for approval. The COIN ETF, developed by Cameron and Tyler Winklevoss, seeks to offer investors an opportunity to gain exposure to bitcoin without actually owning the digital currency. For many, the ETF will provide easy access to a market where a single bitcoin can cost over $1,000.
The approval of any Bitcoin ETF would be an extremely important step in democratizing the cryptocurrency that has proven to be unpredictable in price. As the decision date nears, currency investors are flocking to bitcoin to reap the expected rewards of a possible approval. Bitcoin value has increased more than 60 percent over three months, and it reached an all-time high just above $1,200 on Friday. This record puts the market capitalization of Bitcoin, the total value of all bitcoin in circulation, at almost $20 billion. In-depth bitcoin value information can be found at CoinDesk.
While the majority of traditional financial institutions have not directly invested in virtual currency, the recent optimism in the bitcoin market and the potential SEC approval of a Bitcoin-related product may indicate to banks and larger firms that this investment is safe as well as potentially lucrative. However, there are many questions inherent with a digital currency that need to be addressed before widespread adoption can occur. Reuters reports that there is “scant evidence” of institutional investors showing interest in bitcoin, due mainly to concerns about liquidity in the market.
Despite these concerns, traders are optimistic about the value of bitcoin, evidenced by its rapid increase in price, and the approval of a bitcoin ETF would be groundbreaking for any cryptocurrency. All eyes will be on the SEC come March 11 as it determines the future of this up-and-coming digital currency.
Read more from Reuters.
Read more from CoinDesk.
Learn more about COIN here.