The SEC had ETF approval for bitcoin and cryptocurrency for a variety of reasons. The most important reason was the unregulated market. While decentralization in Bitcoin is an attribute that makes it an ideal asset class, the marketplaces or exchanges that convert FIAT into cryptocurrency are still controlled by independent companies.
A recent SEC report by Bitwise Asset Management that more than 95% of the cryptocurrency volume is forged . Thus, the "actual spot volume" of crypto currency exchanges is just over $ 270 million. In addition, the reported volume of CME and Cboe Bitcoin futures accounts for more than one-third of Bitwise's estimated "actual spot volume".
According to Bitwise Asset Management
This is good news as it means CME-a regulated, controlled market ̵1; has a material size that is important for an ETF.
The Case of a Bitcoin ETF Admission Application
CME Bitcoin Futures had a spot trading volume of $ 85 million. According to Bitwise Asset Management, the actual trading volume of Crypto-to-FIAT exchanges is approximately $ 273 million. According to this statistic, CME's futures trading volume alone accounted for 31.1% of the "actual conversion volume"
. In addition, there are other Bitcoin futures markets active in Europe and Japan. Based on the above statistics, it can therefore be said that institutional investment may coincide with unregulated investment in Bitcoin.
However, the exchanges reported a total spot volume of $ 6 billion. This can inevitably raise doubts about its demand, which is over $ 100 billion. However, the total market capitalization of a cryptocurrency is not directly affected.
The spot trading volume of gold is 0.55% of its total market capitalization, while according to Bitwise statistics the actual spot trade in Bitcoin is 0 , 39%. If the volume of CME Futures is included in this data, the percentage increases to 0.51%. The OTC trading volume on most stock exchanges is also not included in the stock market data.
All this suggests that institutional investment in Bitcoin is significantly more significant than expected. Not only is it healthy in terms of volume, it is also statistically consistent with the next transferable asset class; H. Gold. A new form of information mechanics for Bitcoin and Cryptocurrency trading on regulated exchanges may therefore ease doubts about the approval of the Bitcoin ETF.