Published
3 weeks ago on
April 28, 2024
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The latest action taken by the Depository Trust and Clearing Corporation (DTCC) is going to impact Bitcoin spot ETF products indirectly.
The Depository Trust and Clearing Corporation (DTCC) is the leading provider of post-trade clearing and settlement services in the financial markets. In simple words, we can say that DTCC is a middleman for the ETF products buy-sell settlement in the background level, without a high financial burden.
On 27 April 2024, DTCC decided that it would not provide any collateral to ETFs with exposure to Bitcoin or any cryptocurrencies and also would not extend loans against them. This new rule will come into effect from 30 April 2024 officially.
Wow! What a Wallstreet #DTCC haircut!
— TheJNelsonWay (@thejnelsonway) April 27, 2024
No collateral VALUE for any ETF involving #Bitcoin or other #crypto!?!
What are they alluding to? …that Most Crypto holds no value? And thus can not be collateralized? 👀🧐🤔
Are most financial institutions overleveraged?!? Interesting! pic.twitter.com/rljHbxnVre
This recent decision by DTCC won’t affect the trading of ETF products for individuals, but it could lead to reduced liquidity and increased risk. However, it might also discourage larger fund managers from taking on significant lines of credit against their crypto assets, which could prevent market manipulation due to their large positions.
ETH ETF appears on DTCC
Just a day ago, DTCC listed Franklin Templeton’s proposed Ethereum spot ETF product on its website. People considered the ETH ETF listing on DTCC a significant bullish move for the Ethereum market.
https://t.co/QYidvUlWLN#Franklin Templeton’s Proposed #ETH Spot ETF Appeared On The Depository Trust And Clearing Corporation Website
— Bitcoinik (@Bitcoinikdotcom) April 27, 2024
Here it’s important to note that the listing of any ETF on DTCC does not guarantee approval by the corresponding financial regulator.
In recent weeks, we saw that the legal war between the US SEC and Ethereum surged rapidly and this is a big sign that the SEC body is not in the mood to give a green signal to ETH spot ETF applications.
Ethereum (ETH) price action
The current trade price of Ethereum is $3,312 & this trade price has been 6% higher over the last 24 hours.
This small pump in the trade price of Ethereum is showing surging bull sentiments around cryptocurrencies again.
#Ethereum rally begins? pic.twitter.com/3pQGWFnVI1
— Bitcoinik (@Bitcoinikdotcom) April 28, 2024
Read also: Elon Musk pumps $Grok crypto Token by 65% within an hour
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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