Positive News for Two Biggest Cryptos: Hope Sparked for Spot BTC ETFs; Goldman Sachs’ ETH-Based Options Contracts
There’s some positive news for the two biggest cryptoassets in the world. The approval of a new bitcoin (BTC) futures-backed exchange-traded fund (ETF) by the US Securities and Exchange Commission (SEC) has again sparked hope that a spot-based bitcoin ETF could come next. Meanwhile, investment banking giant Goldman Sachs has taken steps to expand its offering of over-the-counter (OTC) crypto options trading to options contracts based on Ethereum’s native token ETH.
Spot bitcoin ETF argument
Discussions in the community about how the SEC would treat new applications for spot-based bitcoin ETFs follow the approval of the Teucrium Bitcoin Futures ETF on Wednesday this week.
According to Bloomberg’s senior ETF analyst Eric Balchunas, the approval is a “good sign for spot” given that the application was filed under the so-called ’33 Act, a rule that the SEC has previously said does not offer sufficient investor protections.
JUST IN: SEC Approves Teucrium Bitcoin Futures ETF. Notable bc it was filed under the 33 Act, which Genz has said doesn't have enough inv protections vs 40 Act. So poss this is good sign for spot, altho we still think exchanges need regs bf he will green light. h/t @CoinDesk pic.twitter.com/SZMkuMrASc— Eric Balchunas (@EricBalchunas) April 6, 2022
A spot bitcoin ETF refers to an ETF that holds actual bitcoin rather than bitcoin futures contracts, with the latter often referred to as ‘paper bitcoin’.
Analyzing the decision further, Michael Sonnenshein, CEO of digital asset manager Grayscale Investments, said the SEC as recently as last week cited a different set of standards under the ’33 Act and the more commonly used ‘40 Act as its reason to continue to reject spot-based Bitcoin ETFs.
Given the approval of the Teucrium under the ’33 Act, those arguments used by the SEC have now been “significantly weakened,” Sonnenshein argued on Twitter, adding:
“Therefore, if the SEC is comfortable with a Bitcoin futures ETF, they must also be comfortable with a spot Bitcoin ETF.”
He went on to remind his followers that Grayscale’s own application to convert the Grayscale Bitcoin Trust into an ETF is registered under the ’33 Act.
“This is the argument Grayscale has continued to make since filing our application to convert GBTC to a spot Bitcoin ETF. And today that argument becomes even stronger. Thanks TeucriumETFs and congratulations,” Sonnenshein wrote.
Goldman expands crypto options business
Meanwhile, investment bank Goldman Sachs said earlier this week that it plans to expand its current over-the-counter (OTC) offering of bitcoin options to options contracts based on ethereum.
The comments from the bank were made by Andrei Kazantsev, Goldman Sachs’ global head of crypto trading, who during a client webinar said they plan to launch cash-settled ETH options “in due course,” according to Bloomberg.
Notably, George Lewin-Smith, an associate on the bank’s digital-assets team, said in the same webinar that conversations with clients have increasingly focused on investments in ETH. The second-most valuable cryptocurrency is among Goldman’s clients seen as “more of an investable asset class,” the Bloomberg report said.
Commenting on the move by the major investment bank, Paolo Ardoino, chief technology officer at the major crypto exchange Bitfinex, said that institutional adoption of a variety of digital token products is “inevitable.”
Ardoino said in comments shared with Cryptonews.com that,
“Goldman’s decision to offer over-the-counter bitcoin and ethereum options is doubtless a response to huge pent-up client demand from investors that see the potential of cryptocurrency.”
“While some of bitcoin’s most vocal critics display a flimsy technical grasp of blockchain applications, the smart money is moving inexorably to this space,” the Bitfinex CTO concluded.
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