SEC Delays Approval of Bitcoin Exchange Fund; Gas prices continue to rise

CryptoCorner

The US Securities and Exchange Commission has postponed the completion of its review of SkyBridge Capital’s application for an exchange-traded Bitcoin fund to the end of August.

SkyBridge Capital, a $ 7 billion alternative mutual fund led by Anthony Scaramucci, announced on Jan.

“The Commission believes it would be appropriate to set a longer period of time to respond to the proposed rule change so that it has sufficient time to review the comments received,” said J. Matthew DeLesDernier, SEC Assistant Secretary, in a letter , which was published on the website of the Federal Agency. “Accordingly, the Commission is setting August 25, 2021 as the date by which the Commission will either approve or reject the proposed rule change or initiate proceedings to decide whether to reject the rule.”

The proposed ETF would allow retail investors to invest in Bitcoin without directly owning the asset. So far, the SEC has been reluctant to approve a Bitcoin ETF, and some speculate that it won’t because the crypto is too volatile.

But that didn’t kill interest in Bitcoin.

“I’m not a bitcoin evangelist, but I am a bitcoin investor,” said Anthony Scaramucci. In the photo he attends The Hollywood Reporter’s Most Powerful People In Media 2018 at The Pool on April 12, 2018 in New York City.
Ben Gabbe / Getty Images

The Federal Reserve, the country’s central bank, has kept interest rates low to aid the recovery as the economy emerges after the COVID-19 shutdown. Small savers have been crushed by low interest rates. In most cases, a commercial bank savings account will not keep up with inflation.

Bonds are safe, but yields are low.

The Fed has printed big billowing clouds of money, and increased government spending has sparked fears of inflation. So, despite its volatility, some investors have turned to Bitcoin in search of returns.

Bitcoin surged about 90% over the year when Scaramucci announced plans for the EFT in March. The crypto later hit an all-time high, but recently lost about half of its high before recovering.

Others have tried to launch a Bitcoin ETF, including WisdomTree Investments, NYDIG, VanEck, and Valkyrie Digital Assets.

So far, however, the SEC has been reluctant to approve Bitcoin ETFs due to the wild fluctuations in the price of the cryptocurrency, lack of oversight and the possibility of market manipulation.

However, two Bitcoin ETFs are traded on the Toronto Stock Exchange. Bloomberg reported that ETFs were launched in Europe that track the crypto market and whose market value exceeded $ 1 billion in 2020.

Skybridge’s proposed minimum investment in the proposed EFT is $ 50,000. The minimum additional investment is $ 25,000, but in some cases the requirement can be waived. The proposed management fee is 0.75% per year.

“The partnership’s investment strategy is designed to provide exposure to Bitcoin, the largest and most liquid digital asset, through an institutional fund,” SkyBridge Capital said in its offering note. “The partnership’s investment program is speculative and carries significant risks.”

SkyBridge Capital plans to list the ETF shares on the Arca of the New York Stock Exchange, an all-electronic company that specializes in exchange-traded listings and dominates the market.

An ETF tracks an index, commodity, sector, or other asset such as cryptocurrency. Like shares in a publicly traded company, the fund can be bought or sold on an exchange. The strategy can include buying a range of stocks in a sector to diversify risk, but ETFs can also be tailored to commodities using different investment strategies.

ETFs are often used in building a retirement portfolio. Guinness Atkinson recently completed the conversion of two mutual funds into ETFs.

SkyBridge also manages a Bitcoin fund that invests exclusively in crypto. The fund cautions that investors could lose “all or a significant part of their investment”.

In February, Scaramucci told Yahoo Finance that Bitcoin would hit $ 100,000 in 12 months. He stands by his assessment.

“I’m not a bitcoin evangelist, but I am a bitcoin investor,” he said.

Scaramucci is perhaps best known outside of Wall Street for his 10-day stint as communications director for former President Donald Trump. Since then he has been a sharp critic of the former president.

Bitcoin and the stock markets took a hit Thursday as investors looked for safety amid fears of a variant of COVID and a possible global slowdown in recovery from the pandemic.

The Dow Jones Industrial Average, S&P 500, Nasdaq and Russell 2000 lost mid-day trading.

Japan has declared a state of emergency in Tokyo, the venue of the Summer Olympics, citing a possible recovery of the coronavirus infections and excluded spectators from the events. The decision seemed to give the markets a new fit of nervousness and ended Bitcoin’s modest rally. Ethereum and other cryptos also fell.

In Thursday’s midday trading, Bitcoin changed hands at $ 32,831.64, down 4.94% in the past 24 hours but up 12.62% for the year. The 24-hour range is between $ 32,114.78 and $ 34,779.41. The all-time high is $ 64,829.14. The current market capitalization is $ 615.60 billion, reported CoinDesk.

Market pulse

Gasoline prices are up about 40% since the beginning of the year and are likely to rise.

0115_gas_oil_pricesThe average price for a gallon of regular gasoline is $ 3.13, down from $ 2.25 on Jan. 1, the American Automobile Association said.
Mario Anzuoni / Reuters

The average price for a gallon of regular gasoline is $ 3.13, down from $ 2.25 on Jan. 1, the American Automobile Association said.

Prices could rise another 10 to 20 cents per gallon by the end of August.

The highest average price in the country was $ 4.11 a gallon on July 17, 2008, AAA said.

West Texas Intermediate Crude, the benchmark for US oil prices, recently topped $ 75 a barrel – its highest level since November 2014.

Demand has increased with the reopening of the economy, which has pushed prices up.

Higher fuel costs are sloshing through the economy, driving up production and consumer prices for everything trucked or railroaded, and fueling inflation.

Between May 2020 and May 2021, the personal consumption expenditure index (PCE) rose 3.9% and the consumer price index (CPI) rose 5%.

The fuel supply is in good condition and isolated bottlenecks appear unlikely.

The US Energy Information Agency (EIA) said the demand is 9.1 million barrels a day. Last week, gasoline inventories rose 1.5 million barrels to 241 million barrels.

Crude oil accounts for 52% of the cost of a gallon of gasoline; Refining, 19%; Taxes 16%; Sales and Marketing 14% said the federal agency.

Tropical Storm Elsa hit land on the Florida Gulf Coast north of Tampa. It missed the refineries on the Texas Gulf Coast, so it won’t stop production.

The storm is expected to hit the east coast by Friday and bring heavy rain to New York by Friday.

The Organization of Petroleum Exporting Countries (OPEC) has failed to reach an agreement that could increase production by up to 500,000 barrels a day in August.

Earlier this week, White House press secretary Jen Psaki said the US had spoken to OPEC members and urged them to reach an agreement.

An increase in production would expand supply and slow down the rise in prices.

“We expect global oil production to catch up with the surge in demand in 2021 in the coming months,” said Stephen Nalley, acting EIA administrator, in a press release.

“US and global oil producers are increasing production, which should help moderate oil prices, which have risen significantly as global economic concerns about the COVID-19 pandemic have subsided.”

According to the AAA, the 10 states that report the biggest price hikes at the pump this week are: Idaho (+10 cents), Alaska (+9 cents), Washington (+7 cents), Oregon (+7 cents), Colorado (+7 .). Cents), Ohio (+6 cents), Utah (+6 cents), Wyoming (+6 cents), Nevada (+5 cents) and Montana (+5 cents).

The ten states with the lowest average prices are: Mississippi ($ 2.75), Louisiana ($ 2.76), Texas ($ 2.80), Missouri ($ 2.80), South Carolina ($ 2.81), Alabama ($ 2.81), Arkansas ($ 2.82), Oklahoma (2.83), Kansas ($ 2.87), and Tennessee ($ 2.88).

On Wednesday, prices in California averaged $ 4.30 per gallon.

The Lundberg Survey called California the “flagship for the devastating rise in retail prices”.

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