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Japan Bitcoin ETF Approval Might Affect US SEC

January 14, 2019

Japan appears to be complicating everything for the US Securities and Exchange Commission (SEC) after the country’s Financial Services Agency (FSA) approved the first Bitcoin ETF. Not many expected the FSA to pull the move as market observers feel the approval will influence the SEC final decision.

The US SEC is still undecided on whether to approve the Bitcoin ETF in February this year and this continues to create uncertainty in the market especially for the US-based enthusiasts. There is no guarantee that the approval. This comes after Hester Peirce, a pro-crypto and SEC commissioner, cautioned investors against waiting for the Bitcoin ETF to be affected since it may take years.

Bitcoin ETF and SEC Rejection

There is a high possibility that SEC will reject the ETF and this will not be the first time. Last year alone, the commission rejected 12 BTC ETFs that were submitted by the Winklevoss twins and other three firms. The delays appear to have prompted the Japanese outfit to go ahead and implement the same.

According to the Winklevoss’, launching ETF will help exchanges calculate the base asset price based on Bitcoin futures. The rejection, according to SEC is based on the fact that the futures market and exchange have not come of age and their market size is not significant.

The VanEck ETF is bigger than the crypto exchange market since it relies on Over the Counter (OTC) data. This means it is more active and hands-on on the trade and has access to high volumes. This could complicate the decision making for the SEC to avoid being seen as aligned to one side of the market.

SEC Regulations and the Global Markets

The SEC regulations have adversely affected the crypto market and whether they approve or disapprove the Bitcoin ETF, a fair evaluation is necessary and tight regulation for all markets is unavoidable. The SEC appears to be dragging the market to its knees given that other regions are way ahead.

The Japanese, Singaporean, Maltese and South Korean commissions have made huge strides towards a better crypto sphere. They have put in place policies like KYC and AML as well as monitoring the markets and weeding out suspect transactions and reducing the anonymity in the crypto trade.

In November 2018, Jay Clayton, the SEC chair said there is need to put in place checks and balances to protect crypto users from fraudulent transactions and non-existent markets abroad. He also added:

“Those kinds of safeguards don’t exist in many of the markets where digital currencies trade”.

Could Japan Influence the SEC Decision?

Approving ETF in Japan has a lot of implications especially coming before the US makes their decision. This might prompt the SEC to approve the Bitcoin ETF starting with the domestic market. This would also mean that more countries would join in and this would boost the entire crypto market.

When China was putting exchanges and ICO on notice, Japan was seen as the next crypto haven and its ETF approval is a clear indication that she is comfortable with ETFs Japan is among the few countries licensing regulation compliant exchanges and is set to have a huge say in the market in the near future.

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