The Securities and Exchange Commission yet again postponed judgements on two additional proposed spot Bitcoin ETF products – this time from fund management giants Franklin Templeton and Global X.
Citing overlapping grounds for assessing Bitcoin’s resilience to manipulation alongside investor protection concerns, the SEC opted to delay ruling on the innovative ETF filings to dates now falling in 2024.
But in contrast to past deferrals that suppressed prices, the latest Bitcoin markets shrug off the SEC foot-dragging. Markets instead fixated optimism towards growing US derivatives trading volumes plus bullish technical breakouts. Let's analyze the deferment details and whether customers should cheer instead of jeer the calculated SEC approach.
Franklin Templeton and Global X Target Spot Bitcoin ETF First-Mover Prize
Industry observers kept watchful eyes tracking progress towards approving the pioneering physical Bitcoin ETFs from two respected Wall Street brands:
Franklin Templeton - $1.5 trillion asset manager renowned for mutual fund offerings
Global X - $50 billion disruptive ETF upstart already managing a Bitcoin futures fund
Securing the maiden pure-play listed Bitcoin fund in America represents prestigious first-mover stakes ensuring massive inflows off pent up investment demand. These firms now endure lengthened timelines before potential green lights thanks to the SEC.
Global X faced a November 16th verdict date that instead got pushed to December 2022. Franklin Templeton originally saw a November 30th target that now drifts to March 2023. This reacted to SEC commentary around requiring further review tackling previous sticking points impeding approval over myriad past applications.
Why the Delayed Rulings Represent Calculated Regulatory Progress
In prior bitcoin ETF judgements, outright rejections prevented applicants from addressing specific concerns for months without feedback. Lawyers complained of sank costs re-filing into Kafkaesque bureaucracy devoid transparency.
But this round under Gary Gensler's SEC leadership opts for engagement over outright dismissal. Deferred decisions accompanied detailed memorandums signaling they helpfully identify remaining grey areas around:
- fraud and manipulation assessment frameworks
- share liquidity expectations
- custody controls and monitoring for fund reserves
This decision-making evolution suggests the SEC nears comfort finally approving physical bitcoin vehicles following half a decade resisting industry pressure since the Winklevoss ETF flop. But measured methodology unwilling to cut corners signal faith in eventual passage rather than obstructionism.
Especially as Gensler himself stated “I look forward to the staff reviewing these filings." Such receptive language diverges from his predecessor Jay Clayton’s cold apathy towards bitcoin ETFs bordering on hostility.
With both Franklin Templeton and Global X's huge resource pools capable of addressing outstanding concerns through continued regulatory dialogue, their ultimate odds gain confidence sans outright rejection.
“We intend to respond to this feedback and work toward carrying out the Commission’s mission."Franklin Templeton President, Jennifer Johnson
Their willingness to remedy opaque deficiencies around custody, arbitrage tests, and manipulation resilience checks necessary boxes that eluded previous spot ETF applicants. This calculated process promising an eventual win explains muted market disappointment.
Current Bitcoin Price Action and Sentiment Stay Aloft Post-Delay
Recall Bitcoin markets recoiled violently through 2018-20 whenever SEC rulings foiled crypto ETF dreams that year. Lengthy bear trends commenced immediately thereafter.
But with futures ETFs like the blockbuster ProShares Bitcoin Strategy ETF normalized nowadays plus spot versions already trading globally, the SEC's foot dragging avoids crushing confidence domestically.
Instead, traders focused on Bitcoin decoupling from stocks with correlated assets dropping while cryptocurrencies rallied thanks to bullish chart signals. This divergence keeps BTC prices buoyant with key technical resistance hurdles overcome.
Fundamentally, record setting Bitcoin derivatives volumes from CME markets surpassing 2021's rates show regulated institutional demand unperturbed by homegrown ETF uncertainties.
With exposure options abounding today and more sophisticated understandings on why methodical approval pathways assist Bitcoin's reputation long-term, SPOT prices barely blinked this round.
Verdict: Delay Ultimately Helps Legitimize Bitcoin Investing
Through the lens of past Bitcoin Manias, SEC delays again postponing the pioneering crypto ETFs from American financial incumbent giants Franklin Templeton and Global X may disappoint some. But markets emerged unfazed given alternative on ramps flourishing today.
And the SEC’s constructive guidance detailing remaining steps to satisfy and earn approval reveals positive intent welcoming new asset classes into legacy investor toolkits. This sharpens long-term outlooks committing towards comprehensive regulation, not obstructionism.
“The delay in approving indicates the SEC is still working to understand and become fully comfortable with this emerging asset class rather than outright rejecting it.”SEC Commisioner, Hester Peirce
Rather than deter and threaten nascent digital gold markets so critical for diversification against devalued dollars, the SEC's administrative reticence here assists Bitcoin legitimacy over hastier missteps potentially approving inadequate products vulnerable later to misconduct scandals that would setback adoption severally.
Their methodical launch manual fine tunes guardrails assuring fund safety. And the lengthy evaluations educate regulators to legislate effectively around unprecedented cryptocurrency instruments. Both outcomes strengthen Bitcoin resilience and trust long-term despite bot frustration over launch delays.
So instead of groaning, advocates should graciously welcome the SEC’s patient approach ensuring the maiden spot Bitcoin ETFs from Wall Street titans Franklin Templeton and Global X meet expectations when they ultimately arrive under fair compromised rule sets benefitting all.