You’ve probably all seen the news that the SEC denied nine crypto ETF proposals on Wednesday.
This was no surprise (though the SEC issuing a temporary stay on the denial the next day was). Fortunately, the market reacted appropriately and shrugged off the news.
It’s important to note that the ETFs denied this week were futures-based products. These ETFs wouldn’t have held any real bitcoin and wouldn’t have created any additional demand. (In fact, they would have given people an easy way to gain exposure to bitcoin without actually owning any, so the SEC’s rejection of these ETFs could be a net positive.)
The ETF proposal we are watching most closely is the VanEck SolidX Bitcoin Trust. The SEC has delayed that decision until September 30 and could push it back further.
But this one will be harder for it to deny. This fund will be backed by real bitcoin, and it’s targeted at professional investors. Each share will begin trading at $200,000 if it is approved. Because the product is aimed at institutional investors, it will be harder for the SEC to argue that it’s protecting consumers from a risky product.
The other big institutional catalyst I’m watching is the launch of Bakkt in November. Bakkt is the new crypto custody and trading solution owned by the New York Stock Exchange’s parent company, Intercontinental Exchange.
As I wrote a few weeks back:
| This is a serious endeavor, and it’s exactly the type of solution that’s needed to bring big investors into crypto. Professional investors are conservative by nature. They want to work with big names they can trust. Bakkt gives them exactly that. |
So even if we don’t get the first crypto ETFs this year, the market has found a workaround. Institutional buyers will be able to buy and store bitcoin, and eventually other cryptos, in a secure and regulated way. It’s huge news, and the public still hasn’t fully realized the implications.
Now let’s look at some portfolio news.
Nano (NANO)
Despite nano’s price taking a beating (like the rest of the market), its team continues to execute at a high level and push out new updates.
The most exciting recent news was the results of a stress test of the Nano network. During the test, nano achieved a maximum of 756 transactions per second! That’s about 100 times more than bitcoin can handle. And it’s on a network where transactions are free.
There was a robust discussion about this positive news on Reddit.com/r/cryptocurrency. During this downturn, the Nano community has shown strength and resilience. It is during times like these that a crypto’s true potential shows, and I believe nano remains one of the coins with the highest upside.
Decred (DCR)
The big news from Decred’s July update is a report that institutional investors are buying it up. The report comes from i2 Trading, a licensed OTC crypto liquidity provider. (It helps big buyers acquire cryptocurrencies.)
| We continue to see institutional interest in DCR. Large block buyers love the concept of staking as a way to earn additional income and appreciate the stakeholder rights it affords them. Likening a DCR investment to an activist shareholder/bondholder gives these institutions some comfort while dipping their toes into a burgeoning new asset class. |
Another major development is the launch of Politeia on the mainnet. This is an important part of Decred’s governance and voting system.
The ability to navigate choppy waters is a critical component of success in both the crypto world and the economy at large. Decred and Nano are showing that ability, and that’s a good sign for the future.
Good investing,
Adam