Regulation of Crypto Currencies in the USA Is Still Complicated
Scroll DownThe emergence of cryptocurrencies on the world market has created more questions for investors than opportunities. Prevailing regulations from the SEC and other international governing bodies put a damper on peak interest shown by seasoned investors. There is however, a positive swing in the growth of new investors wanting to enter the market because of the “newness” cryptocurrencies offer. In particular, the establishment of either exchange-traded funds, or exchange-traded notes. Both of these buy-in options would allow people to purchase cryptocurrency profit participation, rather than actual currency portions. Both ETFs and ETNs, with full approval, would radically shift the way international markets behave. An exchange-traded fund (ETF), allows people to purchase something similar to a traditional stock. It would create a fund scenario, for something like Bitcoin, that is very similar to existing funds that operate presently. Bitcoin value gains would be distributed to fundholders in a way that is very familiar to places like Wall Street. An exchange-traded note (ETN), is like an ETF, but the purchased interest would be backed by the assumed solvency of a banking body. This puts another blanket of regulation on a concept that has already experienced major setbacks. The real problem with ETNs includes the possible involvement of entities that use them to fuel money schemes. Again, if rules that are heavily-weighted against the success of cryptocurrency were lifted, the risks would be more calculable for investors. For these reasons, integrating a crytocurrency ETF into the present market would be an investor’s dream. It would literally open an new universe of investing options to established and novice buyers. Some dreams do come true, but an integrated cryptocurrency ETF application could be far away. Normally, international exchanges experience sharp increases and decreases with only the hint of a new investor opportunity. Pairing a traditional ETF system with something as volatile as cryptocurrencies, though some show amazing promise, seems to be quite unlikely. Of course, like markets have done in the past, an unexpected shift could happen. If so, a cryptocurrency exchange-traded fund would be an investors dream come true.
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