While Bitcoin and other cryptocurrencies have already gained a lot of attraction from investors all over the world, many institutions such as government agencies, banks and other entities have yet to accept the digital currency.
According to Ryan Radloff, head of investor relations at XBT Provider, it is really just a stalemate between banks and regulators, wherein banks will only start accepting the cryptocurrencies when the regulators do. Though this is the case for most countries, there are several countries such as Sweden whose Nasdaq has already included cryptocurrencies in their public exchange.
Bitcoin status in the US
Bitcoin’s status and classification as per the US regulators have still not been decided as of yet. The SEC has not made any comment in classifying Bitcoin yet and it seems like it will not happen anytime soon.
The SEC has already rejected two entities that aim to provide Bitcoin ETFs to potential investors. From the legal side, it seems as though Bitcoin is not doing very well due to this hurdle.
According to Radloff, it doesn’t look like Bitcoin will be accepted anytime soon following the two rejections that the SEC made, though this may all change in the future if the SEC becomes convinced by the cryptocurrency.
Bitcoin in other countries
Although the US is very stern with their decision on the Bitcoin issue, there are other countries that seem to be more open to the cryptocurrency. Other countries such as Sweden, Switzerland, Japan and Italy have accepted Bitcoin in their public exchange and already have regulations regarding it. Radloff also stated that in the future, he is expecting more countries to accept cryptocurrencies.
Notably, there are exchange-traded Bitcoin products in Europe, but they aren't ETFs, they are exchange-traded notes, which are similar to ETFs but carry different risks. However, European investors and regulators are more accustomed to ETNs, said Radloff.
The COINXBE and COINXBT ETNs are listed on the Nasdaq Nordic. Another ETN-style Bitcoin product was recently delisted from the Gibraltar Stock Exchange.
Nick Cowan, managing director of the latter exchange, said he's expecting two similar Bitcoin products to be listed soon, as well as a third based on a basket of several cryptocurrencies.
Convincing the US
While the market is still relatively new, it has already gotten a lot of attention from investors who have drawn a lot of data from it. However, the only problem would be the government regulations and licenses. A report by the University of Cambridge’s Center for Alternative Finance stated that 46 percent of exchanges are not government regulated. This means that the other 54 percent are not operating with licenses.
While it may be difficult to convince US regulators to accept the digital currency, it is still possible as the US is looking for transparency and stability before they consider allowing it. The reason is that it involves a lot of money and it is quite a risk on their end.
Nevertheless, it would seem as though the US will not be one of the next countries to accept the cryptocurrency. However, it will only be a matter of time before this event happens. When the US sees a lot of other countries doing it, they will most likely join in the fray.