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| By Jurica Dujmovic |
Yesterday, I was on yet another interesting Twitter Spaces call, organized by our friends at Seasonal Tokens.
I was joined by an expert you might be familiar with from my previous issues, Ruadhan O — creator of Seasonal Tokens — as well as another speaker, Jerry Lim, a representative of the newly incorporated Asian exchange, Coinstore.com.
Now, the main topic was about the Securities and Exchange Commission’s war on crypto. Although most of my readers are well aware of my stance on the SEC, for those of you who are unfamiliar, my MarketWatch article here sums it up nicely.
But I believe this one sentence encapsulates my viewpoint: “The SEC is trying to annihilate the burgeoning world of cryptocurrency in the U.S.”
So, imagine my surprise when I heard Jerry’s naïve pledge that he would do everything in his power to follow the SEC’s rules so that it doesn’t target his exchange and shut it down.
Then, when asked what he thought about the motives behind the SEC’s actions, Jerry’s response was a cookie-cutter quote about the SEC “curbing money laundering” and acting for the benefit of all U.S. investors.
Listening to Jerry go on about how his exchange is doing all it can to comply with the SEC made me think of another exchange that had a similar motivation. It also did everything it could to comply … but still ended up in the SEC’s crosshairs.
You guessed it: I’m talking about Coinbase (COIN). This is the very same company that obeyed all the rules it was given by the SEC, and the very same SEC that reviewed Coinbase and later allowed it to go public in 2021.
Given that the SEC approved Coinbase’s initial public offering in the past, its current allegations against the exchange understandably make no sense. And worst of all, it filed a lawsuit instead of passing clear, transparent laws.
You see, although many people refer to the crypto world as the “Wild West,” it’s not crypto that’s on the other side of the law.
Rather than having crypto outlaws, we have poor crypto farmers, bullied by the crooked sheriff, SEC Chair Gary Gensler. In this scenario, Sheriff Gensler is forcing these farmers to shut down their farms and sell their land for cheap to the local bad guy, BlackRock (BLK), so that it can open its own operation on that land.
It would be funny if it wasn’t true.
So, although Jerry’s exchange isn’t currently being scrutinized by the SEC, chances are that this global animosity toward crypto isn’t going to pass him by. There are local regulatory organizations in his country that he must report to, and sadly, I’m inclined to believe they may act in a similar way toward him.
However, there is a silver lining here. As the walls are closing in on crypto, new opportunities are arising for the savvy investors who are shrewd and willing to bet against the house.
This opportunity has to do with BlackRock — the world’s largest asset manager that has recently filed an application for a spot Bitcoin (BTC, “A-”) exchange-traded fund.
Although many companies have unsuccessfully applied for an ETF in the past, there is reason to believe BlackRock will pull it off. Especially given its impressive track record of having only one ETF application rejected in its 35 years of existence.
Reinforcing this sentiment is the most recent move by the SEC, which called BlackRock’s filing “inadequate.”
While many traders see this as something negative, the opposite is true. The fact that the SEC responded so quickly after the initial application — and that it returned the filing back to the applicant — shows its desire to help push the application forward. In this way, the forms can be filled out properly and the SEC can approve them faster.
The clock is ticking, you see. As the next Bitcoin halving approaches, it should bring positive effects to its price, as the guests in my previous article pointed out. Indeed, BlackRock wants to get its application approved before the price peaks … and well before the market prices this all in.
Now, this is where the average investor comes in. By following the big players and not giving in to the SEC-fueled fear, uncertainty and doubt, you too, can partake in this price appreciation that BlackRock and the SEC are counting on.
But this is just my take. Please keep in mind that there are many nuances to this story and many other angles to expand this narrative on.
Regardless, this could be one of the biggest profit opportunities of 2023.
That’s why I invited in-house crypto experts Alex Benfield and Chris Coney to our inaugural Twitter Spaces series, “Into the Cryptosphere.”
The first episode, dubbed “Institutional Adoption 2.0,” will cover the opportunities and risks brought on by BlackRock’s ETF, as well as other institutional moves toward crypto our analysts see occurring in the upcoming weeks and months.
The call is free and open to all our followers on Twitter, so be sure to set your reminders here, and then tune in tomorrow at 12 p.m. EST!
This will be a 30-minute discussion, but at the end, we will open the floor for questions from the audience. So, make sure to come prepared with any questions you have, as we’d love to hear from you!
Best,
Jurica
