ETF Will Not Be Launched Until Industry Is Legitimate
BlackRock, the biggest manager of assets and ETF solutions, has been slowly accepting the idea of cryptocurrencies, but the company is waiting for the industry to become fully legitimate before launching a BTC ETF, according to their Chief Executive Officer Larry Fink.
Fink expressed how the project would have to be backed up by a government entity and they will not allow for it to happen except when they understand where the money is heading.
Fink noted that he feels concerned about the possibility for scams, money laundering activities, or evasion of taxes because the industry is essentially operating anonymously, without regulations and on a decentralized basis.
He said that until these issues are addressed, BlackRock, which now is the custodian of $6.4 trillion in assets, has no plans of launching a crypto ETF.
Fink continued to state that he sees the company one day participating in digital trading for a crypto that will be a great store of value, but today the world is not in any need of a store of wealth.
BlackRock has been looking towards the future of BTC to provide exposure to cryptocurrencies and blockchain technology and has been doing so since last July. The move surfaced following Fink’s comments criticizing BTC as a precursor to money laundering activity.
SEC Rejecting the Idea
Last August, the SEC rejected 9 BTC ETF project proposals. In its rejection of the newest round of BTC ETF projects, SEC said that the candidates were not able to show how they would be able to mitigate any fraud attempts or general manipulation within the market.
In the meantime, VanEck, a company that manages ETFs, has the goal of being the first company to launch a BTC ETF. Even though the SEC keeps rejecting any overtures in this direction, Gabor Gurbacs, the director of online assets at VanEck, keeps a positive attitude towards approval happening soon. Gurbacs sees the need in America for the product and says his company is available to start designing it.
He also expressed confidence that the industry is moving forward and that the potential for the coming financial structure should not be ignored.
One example of someone who used to criticize cryptocurrencies but is now embracing the idea is Ron Paul, an ex-United States congressman. Paul sees that an economic recession can be avoided by using the technology.
Paul continued on to say that the next likely recession is to be expected much sooner than what is believed and that it will be a huge crisis that might mark the end of the line for fiat currencies. He said that in his mind, the way to completely avoid the next crisis in the economy is through the use of other possible currencies and to absolve all Txs in metals and cryptos from capital gains taxes or any other type of taxes.