For years, bitcoin exchange traded funds (ETFs) have been struggling to get off the ground and receive approval from the U.S. Securities and Exchange Commission (SEC). Passive fund providers are now arguing there is sufficient market liquidity for a bitcoin ETF to be launched in 2019.
Also read: SEC Wants Second Look at Nine Bitcoin ETFs
ETFs to Top $9 Trillion by 2022
ETFs are becoming a large part of the investment landscape. Research firm ETFGI predicts that in 2020, ETFs and ETPs listed in Europe will reach $1.1 trillion. Morgan Stanley forecasts global ETF assets to top $9 trillion by 2022. As interest in these products grows, regulators have been addressing structural vulnerabilities. Research conducted by broker and asset manager Charles Schwab shows the millennial generation is increasingly choosing to invest in ETFs accessed by apps. It could be when – or if – the SEC approves a bitcoin ETF.
There have been a number of applications submitted over the years. The most recent ones include Proshares, which had two proposals for a bitcoin ETF, both based on bitcoin futures contracts. There was also the Vaneck-Solidx proposal which is based on a physical-backed bitcoin ETF. Before an ETF is approved to trade on one of the U.S.’s major exchanges, there is a number of factors which need to be considered.
Bitcoin Market Cap Stands at $72 Billion
Last year, Blockforce Capital launched blockchain ETFs in the form of BLCN and the world’s first Chinese blockchain ETF, BCNA. Eric Ervin, CEO of Blockforce Capital, told news.Bitcoin.com the current market environment has the ability to support an ETF for two primary reasons.