KANALCOIN NEWS – The possibility that the US government will face government paralysis remains. This occurs if Congress fails to pass a funding bill by September 30. The consequences of this situation are quite significant conditions for the financial sector. Especially regarding the approval of exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC).
According to NYDIG, a leading provider of Bitcoin-related services, the duration of a government paralysis can range from one to 35 days, depending on the political landscape. Of course this will have the impact of hampering the SEC’s capacity to assess and make decisions regarding various ETF applications, especially regarding Bitcoin and Ethereum.
There are Delays Due to Uncertainty
With the SEC’s pending decision regarding spot Bitcoin ETFs, ETFs will offer investors the opportunity to buy and sell Bitcoin directly through a regulated platform. There are several applicants worth paying attention to. Such as BlackRock, Invesco, BitWise, and Valkyrie.
There are developments regarding the delay two weeks before the October 16-19 deadline. This suggests that the regulatory body is preparing for possible paralysis. Which results in the SEC now facing a final decision deadline of mid-March on this application.
Bloomberg ETF analyst James Seyffart predicts that there could be similar delays for other suitors, namely Fidelity, VanEck and WisdomTree. He also suggested that the SEC might adopt a consistent approach to all ETFs by reviewing and approving or rejecting them simultaneously.
Ethereum Futures ETF to Launch Soon
The developer will launch a futures-based Bitcoin ETF in the US. Of course, this will open up opportunities for investors to track and profit from Bitcoin price movements through regulated exchanges. This futures-based ETF alternative has gained significant popularity since its introduction in October 2021, attracting billions of dollars in assets. Although a spot Bitcoin ETF is still awaiting approval.
This ETF will track the performance of Ethereum futures contracts traded on the Chicago Mercantile Exchange (CME), which began operations in February 2021. This is the reason why many issuers have recently filed applications with the SEC to launch Ethereum ETFs based on these futures contracts.
The Securities and Exchange Commission does not consider spot Ethereum ETFs. No publisher has yet applied for such a product. And as a result, individuals looking to buy or sell Ethereum directly will experience longer wait times compared to those who prefer futures-based products.
So what about the market reaction? Bitcoin faced a miner drop of 0.38%, hitting $26,933. This occurred due to uncertainty surrounding ETF approvals and government shutdowns. In contrast, traditional assets such as gold fell by 0.96%, and stocks in general also saw an increase in losses – with the S&P 500 down 0.27% and the Nasdaq Composite down 0.14%. And broadly speaking, government paralysis could hurt the US credit rating.
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