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The recent price appreciation of Bitcoin can be partially attributed to speculation on the approval of a crypto ETF.
An ETF would drastically increase investor adoption of digital assets by decreasing the current friction to ownership. Additionally, an ETF would bring the “stamp of approval” for institutional-grade custody, compliance, and accounting. Essentially, the approval of an ETF would be a green light for most institutions to begin allocating big dollars to the space.
Many in the crypto community are looking at the historical impact of the first gold ETF, which leads them to anticipate a similar effect on crypto prices (chart here). If this occurs, the price of digital assets should rise drastically in a very short period of time.
Here are a few things to keep in mind around this decision:
The stated timeline for a decision is misleading. The SEC can continue to extend their decision into Q1 2019. Read more about the nuances here.
In the world of commodities, an index ETF was approved before a single asset ETF. If this happens in crypto, expect Bitwise’s HOLD 10 ETF to be approved before any Bitcoin ETF.
Futures trading volume is starting to pick up (chart here). This should be a strong signal that there is strong institutional demand pent up. An ETF will capture a lot of this so wouldn’t be surprised if billions of dollars rush in.
A cryptocurrency ETF, regardless of structure, would be an important milestone for the asset class. Just don’t expect a decision anytime soon.
Fifth Wall Ventures is bullish on the tokenization of real estate: Fifth Wall Ventures invests exclusively in startups focused on real estate technology across sectors such as hospitality, retail, and construction. Fifth Wall managing partner Brad Greiwe said, “Tokenization is probably the most interesting thing we think about on a daily basis because companies like Harbor are going to create opportunities like we’ve never seen before.” Read more.
Uber co-founder and E*Trade alum launch no-fee crypto trading: More competition is coming to the commission-free cryptocurrency trading market. Voyager, a startup backed by an Uber co-founder as well as an early investor in the ride-hailing company, revealed plans Wednesday to offer no-fee trades of at least 15 different cryptocurrencies, including Bitcoin, Ethereum and others. Read more.
Alexis Ohanian discusses his VC firm’s commitment to crypto: Reddit and Initialized Capital co-founder Alexis Ohanian said Bitcoin is “certainly the most robust” and “one of the best proofs” of crypto being a possible store of value — something he underscored as increasingly important in a global context of fiscal and political “uncertainty.” Watch his interview.
Coinbase takes on cryptocurrency gift cards with limited rollout: Major U.S. cryptocurrency wallet and exchange Coinbase has entered the crypto gift card market, allowing customers in certain countries to exchange coins for brand e-certificates. The new option will effectively allow cryptocurrency holders to pay for goods and services through brands such as Nike, Tesco, Uber, Google Play, Ticketmaster, and Zalando. Read more.
Rogue employee mined 500K Bitcoins in 2011: The CEO of Russian e-payments firm Qiwi said that an employee used its payment terminals to mine 500,000 bitcoins in 2011. Solonin said he discovered that one of his developers had hijacked the company's hardware to mine bitcoin when the machines were not in use. Moreover, he found that the developer had made roughly $5 million over the course of a few months Read more.
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