Amidst the crypto pressure, which is believed to govern traditional economies worldwide, it seems that the approval of a BTC ETF by the SEC in the US will have a significant impact on the market.
Major Meeting Took Place
According to a presentation examined by an individual closely related to the matter, major companies in the traditional market, including Jane Street, Virtu Financial, Jump Trading, and Hudson River Trading, had an important meeting with BlackRock. When asked for comments on the subject, BlackRock, Jane Street, Virtu, and Jump declined to comment, while Hudson River Trading did not respond to the comment request.
The regulatory pressure in the US, in response to the FTX collapse and other events in 2022, has led some US companies to adopt a more cautious approach to their activities in the crypto space. According to a news shared by Bloomberg in early May, Jane Street and Jump had restricted crypto trading during those dates.
When considering that the US Securities and Exchange Commission (SEC) has approved some of the applications for Bitcoin ETFs, it can be thought that this may open a new door for US-based firms and provide them with a new path to take action in the crypto market.
The Importance of Being a Game Changer in the Market
Being a market maker for ETFs traded on exchanges is not as easy as it seems in the traditional market. Only a few companies can achieve this and sustain it with great power within regulations. Market makers are crucial for ETFs, just like in every other field.
One of the greatest examples that can be given in this regard is the shareability through Bitcoin and cryptocurrencies. The price of Grayscale Investments’ Grayscale Bitcoin Trust (GBTC) has noticeably diverged from the billions of dollars worth of Bitcoin it holds for the past few years. Grayscale had applied to the SEC to convert Bitcoin Trust into an ETF.
Grayscale’s initial application for conversion was rejected by the SEC. However, in August, a court scrutinized the regulator’s behavior and found the SEC unjust. The SEC stated in October that it would not appeal this decision, and this behavior was interpreted as the opening of the way for Bitcoin ETFs to become a reality in the US.
James Butterfill, the research director at CoinShares, made the following comment:
“Many market makers were withdrawing and acting quite cautiously because there were some heavy pressures on exchanges,” he said. “But since the Grayscale decision, we have seen a very real change in the SEC’s stance.”
