[Bitcoin Now] Cryptocurrency ETF Launch Delayed... Institutions Buy Related Financial Products at Low Prices

On the Morning of This Day, It Rose to Nearly 40 Million Won but Then Fell by About 1 Million Won
Ark Investment Buys Coinbase Stock and Grayscale Bitcoin Investment Trust

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Gong Byung-sun] Bitcoin, the representative cryptocurrency that had risen close to 40 million KRW, has fallen to the 38 million KRW range. The delay in the launch of Bitcoin exchange-traded funds (ETFs) in the United States appears to have had a negative impact. Nevertheless, some institutional investors saw this as an opportunity to buy cryptocurrency-related financial products at a low price.

According to the domestic cryptocurrency exchange Upbit, as of 3:20 PM on the 24th, Bitcoin recorded 38.19 million KRW, down 2.25% from the previous day. It rose to 39.36 million KRW at 9:14 AM that day but then dropped by about 1 million KRW.

The U.S. Securities and Exchange Commission (SEC) postponing the launch of Bitcoin ETFs again acted as a negative factor. On the 23rd (local time), cryptocurrency specialized foreign media CoinDesk reported that the SEC postponed the decision on whether to approve the Bitcoin ETF application submitted by Valkyrie Investments to August 10. On the 17th, the SEC also delayed the decision on whether to launch the Bitcoin ETF by the U.S. asset management firm VanEck. After SEC Chairman Gary Gensler hinted at strong verification by stating at last month's House Financial Services Committee hearing that "investors using cryptocurrency exchanges are vulnerable to fraud or manipulation," the launch of Bitcoin ETFs has become uncertain.

The cryptocurrency industry expected that the launch of Bitcoin ETFs on the U.S. stock market would occur within the year, fueled by Chairman Gensler's appointment in April. Gensler was regarded as favorable toward cryptocurrencies, having taught blockchain-related courses while serving as a professor at the University of Massachusetts. However, last month, the SEC's Investment Management Division pointed out that "Bitcoin derivatives are highly speculative and volatile assets," showing a skeptical view of Bitcoin.

The U.S. Treasury Department has also consistently expressed a negative perception of cryptocurrencies. Earlier in February, U.S. Treasury Secretary Janet Yellen said, "Bitcoin is a highly speculative asset." Newly appointed Treasury officials are also negative toward cryptocurrencies. According to U.S. economic media Bloomberg on the 22nd, Brian Nelson, nominee for Treasury Under Secretary for Terrorism and Financial Intelligence, said at the Senate confirmation hearing, "The anti-money laundering law amendment passed by Congress earlier this year granted authority to regulate cryptocurrencies," and "If appointed as Under Secretary, I will prioritize enforcing the anti-money laundering law amendment." The anti-money laundering law amendment includes cryptocurrencies or cryptocurrency businesses as subjects of regulation to check for money laundering.

Meanwhile, Ark Investment viewed the Bitcoin decline as an opportunity for bargain buying. According to U.S. economic media CNBC, Ark Investment purchased 214,718 shares of Coinbase, a U.S. cryptocurrency exchange, through the Ark Innovation ETF. The cryptocurrency investment trust "Grayscale Bitcoin Trust," managed by U.S. asset management firm Grayscale, also bought about 1 million shares through the Ark Generation Internet ETF. Cathie Wood, CEO of Ark Investment, is a leading cryptocurrency advocate who argues that Bitcoin will ultimately benefit the environment.