Is Binance’s $4B Settlement Green Light for Spot Bitcoin ETFs?
Binance's $4.3 billion deal with the United States comes before the country's securities regulator approves the space for Bitcoin exchange-traded funds (ETFs), many industry watchers say.
The agreement includes Binance agreeing to up to five years of compliance with the Department of Justice and Treasury Department, which will allow the agencies to use their powers to ensure the exchange complies with anti-money laundering and sanctions laws, among other things.
The Securities and Exchange Commission's rejection of the spot Bitcoin ETF cited market manipulation, and Binance's market dominance had to come to fruition before BlackRock's spot BTC ETF application was approved, Travis Kling, chief investment officer, said in a June 10 (Twitter) post. Ikigai property management.
“There is no chance, and I mean zero, that this ETF is approved in the current market dominance position with Binance,” Kling wrote. “If this ETF is approved, Binance is either completely gone or their role in price discovery is greatly reduced.”
Okay here we go. https://t.co/fJ7c3MpaTy
— Travis Kling (@Travis_Kling) November 21, 2023
Keeling's prediction has prompted others to wonder how closely BlackRock will work with the US government to secure a favorable position in the bitcoin ETF market. YouTuber “Colin Tox Crypto” said he suspected the Binance settlement happened “right before the Bitcoin ETF came out.”
“Is BlackRock a way to make a lot of money? [sic] BTC cheap?” he asked. “Is it a way to remove competition from US markets before the ETF goes live?”
Does it seem embarrassing to anyone that #Binance was guilty of money laundering just before the #Bitcoin #ETF came out?
Is there a connection?
For example:• Is Blackrock a way to get large amounts of BTC cheap/free?• Is it a way to avoid…
— Colin TCrypto (@ColinTCrypto) November 21, 2023
Others speculated that BlackRock and rival Vanguard own 11.5% of Binance's main competitor, Coinbase, and that the move against Binance may be planned.
BlackRock met with the SEC on Nov. 20 to outline how it will use an in-kind or cash redemption model for its spot BTC ETF, the iShares Bitcoin Trust.
Binance/DOJ settlement and SEC Spot #Bitcoin ETF approvals are mutual.
— Andrew (@AP_Abacus) November 20, 2023
Grayscale met with the securities regulator on the same day to discuss its bid to list the Spot Bitcoin ETF. Fidelity, WisdomTree, Invesco Galaxy, Valkyrie, VanEck and Bitwise are also awaiting SEC approval of their spot Bitcoin funds.
Related: Binance CEO CZ's fall is the ‘end of an era' – Charles Hoskinson
According to Mike Novogratz, CEO of digital asset investment firm Galaxy Digital, the Binance settlement is a “tremendous pressure” for the cryptocurrency industry.
Not everyone sees the point in speculating whether the Binance news will lead to BTC ETF approvals.
Michael Basina of Piper Alderman suggested in a note to Cointelegraph that it is better to let the speculation run its course.
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