As one of the more high-profile bitcoin ETF efforts edges closer to possible approval, analyst Needham & Co has released a deeper look at the factors that could influence the US Securities and Exchange Commission’s decision on the matter.
Published Friday, the report doesn’t go so far as to alter its outlook for the Winklevoss Bitcoin ETF, positioning its odds of approval at below 25% while continuing to state strongly that any positive outcome would be a substantial boon for the technology.
Perhaps most notably, however, the report offers a wider lens-look at three investment vehicles vying for the title of ‘first bitcoin ETF’ (including those by startups SolidX and Grayscale Investments), ultimately concluding that none have a substantially better or worse chance of being given the green light by the SEC.
“While there are some interesting differences between the various filings, we don’t see any differentiations that drastically increase the probability of one filing over another,” the report reads.
Needham goes on to state that it believes the unfamiliarity of bitcoin – and the SEC’s emphasis on consumer protection – is likely to be the biggest hurdle.
“Our sense is that the latter group (questions about bitcoin itself) is the bigger hurdle to SEC approval of a bitcoin ETF,” it continues.
In further commentary, Needham said it believes the market is now more realistic about the changes of approval. It cited changes to a contract on a cryptocurrency exchange that enables traders to speculate on the ETF decision. (As reported by CoinDesk, eager traders have largely already built this forecast into their trading strategies).
Ultimately, the firm said, the thin trading in the markets coupled with the relative lack of changes to the Winklevoss ETF in a recent filing were both cited as reasons why it was reluctant to change its outlook.
For more details, read the full report below:
Bitcoin ETF – Digging Deeper on Probability and Potential Effect (1) by Pete Rizzo on Scribd
Disclaimer: CoinDesk is a subsidiary of Digital Currency Group, the owner of Grayscale Investments.
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