The prospect of a Bitcoin exchange-traded fund (ETF) being approved by U.S. regulators is far from certain according to crypto industry veteran Alex Becker. In a recent tweet, Becker outlined multiple issues which could derail Bitcoin ETF hopes.
Becker pointed to several examples of alleged market manipulation and misconduct undermining the narrative of Bitcoin as a mature asset class ready for an ETF. These include:
- Crypto exchange FTX and its CEO SBF accused of manipulating Bitcoin prices through high-leverage derivatives trades.
- Whale traders moving markets through tweets and rumors, as seen with recent ETF ticker speculation.
- The dominant role of Tether’s USDT stablecoin, which lacks full USD reserves according to critics.
- Cryptocurrency exchanges frequently accused of abusive practices against retail traders.
Per Becker, these systemic flaws in the current Bitcoin market make it “highly manipulated” by definition. As such, regulators like the SEC could deem Bitcoin an inappropriate underlying asset for an ETF product. The SEC holds a duty to protect investors, including scrutinizing manipulation risk.
Crypto advocates often tout a Bitcoin ETF as a watershed moment for mass adoption. But Becker contends that the deep-seated issues plaguing the market could remain roadblocks. Unlike traditional ETF assets like stocks or bonds, Bitcoin lacks both regulatory oversight and price discovery free from potential manipulation.
For Becker, these concerns cast doubt on whether Bitcoin or other cryptocurrencies are yet ready for the mainstream ETF treatment. Until structural problems are addressed, crypto ETF approval may remain elusive despite industry optimism.
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