The hope of a Bitcoin exchange-traded fund (ETF) has been the hope of the cryptocurrency community throughout the bear market that it's sustained. When the concept was introduced last year, this opportunity was a way to entice institutional investors to be drawn into the market, but there has been a lot of disappointment along the way. The SEC has been rejecting every proposed Bitcoin ETF to date, and VanEck completely pulled their application.
Founder of Edelman Financial Engines, Ric Edelman, says that a Bitcoin ETF will eventually be approved, saying that
“the only question is when.”
“The [Securities and Exchange Commission] SEC has several legitimate thoughtful concerns that the industry has to overcome but I'm confident they will. Eventually, we will see a Bitcoin ETF and it's at that stage that I will be much more comfortable recommending that ordinary investors participate.”
Overall, an ETF is security, allowing for a group of assets to be tacked with what would proportionally be the fund’s shares. Edelman explained his point, saying,
“Fidelity has made a major announcement in the custody issue. We've got Kingdom Trust and a number of other very serious players on the custody side. I'm confident that in very short order VanEck or Bitwise will satisfy the custody concern to the SEC.”
The SEC has already said that the lack of security on the chain has been a major factor in the lack of approval, along with the lack of governance and control that the SEC has in overseas trading. Edelman believes that Bitcoin is about the same as an asset as oil and gold, which he stated are
“globally-traded assets beyond the reach of the SEC.”
Edelman Financial Engines was established in 2018 after Edelman Financial Services, LLC and Financial Engines Advisors, L.L.C. merged. Now, the new entity functions as a financial advisory firm with allegedly $205 billion in assets that they manage.
During the interview, the editor-in-chief of ETFTrends.com, Tom Lydon, said that there is clearly an interest in the Bitcoin ETF. He said,
“[W]e interview advisors all the time. 74 percent say they've talked to clients about their interests in Bitcoin, so they need to step up when this happens because that money is going to go elsewhere.”
Edelman continued on Lydon’s note, saying,
“Technologically, regulation-wise it could happen tomorrow. There is no particular motivation because the ‘powers that are’ in the fund industry have no incentive to give up their market share.”